OF  CALIFORNIA 
IGELES 


^^mm^^^^^^Ki^^^m^^^ 


^^mm^^^^^^^^^^^^f^^^m 


i^^M^^^a^^M^^^^^^^^^^^^^H^^^^^^ 


*<i  I  r«^>  ,  & 


mmmm  m  the  double  standard: 


THE    IMPOSSIBILITY  OF  RESUMING  SPECIE  PAYMENTS  IN  THE 

UNITED  STATES  WITHOUT  RESTORING  THE  DOUBLE 

STANDARD  OF  r,OLD  AND  SILVER. 


A  SPEECH  DELIVERED  IN  THE   SENATE  OF  THE   UNITED   STATES, 

APRIL   24,  1876, 


BY 


JOHN   P.  JONES, 


SENATOR    FROM    NEVADA. 


"To  annul  the  use  of  either  of  the  metiils  us  money  is  to  abridge  the  quantity  of  cir- 
culating medium,  and  is  liable  to  all  the  objections  which  arise  from  a  comparison  of 
the  benefits  of  a  full,  leith  the  evils  of  a  scanty,  circulation." — Alex.  Hamilton.  (Report 
to  Congress,  179t.)  • 


-  5  1 


''act^inc 


y/ASH\NGTOH  City: 

m'gILL    a    AVITHEROW,   printers    and    STEliEOTYPERS. 

.  1876. 


*^"^*^^^^^^^^^  ^^^^*^^ 


EESniPTION  AND  THE  DOUBLE  STANDARD 


OR, 


THE  IMPOSSIBILITY  OF  EESUMING  SPECIE  PAYMENTS  IN  THE 

UNITED  STATES  WITHOUT  RESTORING  THE  DOUBLE 

STANDARD  OF  GOLD  AND  SILVER. 


A  SPEECH  DELIVERED  IN  THE  SENATE  OF  THE   UNITED  STATES, 

APRIL  24,  1876, 


BY 


JOHN  P.  JONES, 


SENATOR   FEOM   NEVADA. 


"To  annul  the  use  of  either  of  the  metals  as  money  is  to  abridge  the  quantity  of  cir- 
culating medium,  and  is  liable  to  all  the  objections  which  arise  from  a  comparison  of 
•lie  benefits  of  a  full,  loith  the  evils  of  a  scanty,  circulation." — Alex.  Hamilton.  (Report 
lo  Congress,  1791.) 


WASHINGTON,  D.  C. 

M'gILL  &  WITHEROW,  PRINTERS  AND  STEEE0TYPEE3. 

1876. 


I  >  > 

>    3     > 


«■  t  « 


.«  «.  «  «  «. 


// 


EESUMPTION  AND  THE  DOUBLE  STANDARD. 


Mr.  JONES  said  : 

Mr.  President  :  The  act  of  February  12, 1873,  now  incor- 
porated in  title  xxxvii  of  the  Revised  Statutes,  an  act  which, 
under  the  guise  of  regulating  the  Mints  of  the  United  States, 
practically  abolished  one  of  the  precious  metals,  was  a  grave 
wrong;  a  wrong  committed  no  doubt  unwittingly,  yet  no 
less  certainly  in  the  interest  of  a  few  plutocrats  in  England 
and  in  Germany,  and   as  certainly  in   the   interest  of  the 
entire  pagan  and  barbarian  world;  a  wrong  upon  the  peo- 
ple of  the  United  States  and  of  the  whole  civilized  globe  ; 
a  wrong   upon   industry,   upon  the    natural   tendency  of 
c^  wealth  toward  equalization,  upon  the  liberties  of  peoples 
^  which  are  born  out  of  the  effects  of  such  equalization  of 
^:  wealth,  upon  every  aspiration  of  man  which   depends  for 
oits  renlization  upon  the  development  of  those  liberties. 

The  act  alluded  to,  practically  abolished  one  of  the  pre- 
cious metals  as  money,  the  one  chiefly  produced  in  this 
country,  the  one  chiefiv  consumed  in  the  semi-civilized 
Countries  of  Asia,  and  the  one  which  at  the  date  of  its 
Abolition  and  under  the  time-honored  laws  that  previously 
'=»prevailed,  was  becoming,  as  it  has  since  become,  the  more 
available  metal  of  the  two  in  which  to  transact  exchanges 
and  liquidate  debt. 

Under  the  act  of  April  2,  1792,  both  silver  and   gold 
coins — dollars  or  their  multiples — were  made  a  legal  ten- 
der in  this  country  for  the  payment  of  debts  to  any  amount, 
a.  at  the  rate  of  15  in  weight  of  silver  to  1  of  gold.     This  co- 
^  (3  ) 


ordination  of  silver  and  gold  is  called  the  double  standard. 
A  similar  arrangement  existed  in  the  other  countries  of 
the  civilized  world ;  the  relation  fixed  by  law  in  those 
countries  being  either  15|  or  16  for  1.  A  few  countries 
liad  a  single  silver  standard,  but  no  country,  until  1816, 
had  a  single  gold  standard.  In  this  country,  up  to  1853, 
the  Government  defrayed  the  expense  of  manufacturing 
coins,  whilst  in  Europe,  except  in  England,  where  the  coin- 
aore  is  also  free,  the  owners  of  the  bullion  offered  for  coin- 
age  are  assessed  with  a  cliarge  for  manufacture.  Thus, 
under  our  old  laws,  and,  as  I  shall  endeavor  to  show,  under 
the  requirements  of  the  Constitution,  the  owner  of  either 
gold  or  silver  bullion  had  the  right,  if  the  Government 
chose  to  coin  any  money  at  all,  to  have  his  bullion  coined 
free  of  charge;  and  once  coined  it  became  a  legal  tender  to 
any  amount  for  the  payment  of  debts,  whether  the  bullion 
was  of  gold  or  silver. 

Although  free  coinage  only  dates  from  that  era  of  other 
free  institutions,  the  American  Revolution,  the  double 
standard  of  money  has  existed  since  the  remotest  past. 
This  arrangement,  so  fur  as  we  know,  has  existed  every- 
where and  forever,  notwithstanding  the  fact  that  at  certain 
periods  silver  as  compared  with  gold  is  yielded  by  the  mines 
in  deficit  of  the  world's  consumption,  whilst  at  other  periods 
gold,  as  compared  with  silver,  is  yielded  in  deficit.  At  the 
period  in  question — that  is  to  say,  from  1792  until  the 
eflects  of  the  discovery  of  the  Russian,  the  American, 
and  the  Australian  gold  mines  were  felt — gold  was  pro- 
duced in  deficit;  and  by  reason  of  this  fact,  silver,  at  the 
legal  rate  of  15  for  1,  was  the  cheaper  metal  in  which 
debts  could  be  discharged.  Accordingly,  silver  was  used 
for  this  purpose  in  this  country  to  the  exclusion  of  gold, 
the  debtor  being  at  liberty  to  tender  either  metal  lie 
thought  proper.  B}'  the  act  of  June  28,  1834,  this  rela- 
tion was  changed  to  16.00215  for  1,  and  by  that  of  Jan- 
uary 18,  1837,  to  15.98837  for  1,  in  both  cases  sub- 
stantially 16  for  1,  at  which  figure  it  stood  up  to  February 
12,  1873. 


"When  the  great  Russian  mines  threw  their  auriferous 
products  upon  the  markets,  gold  became  the  cheaper  metal 
at  the  legal  relation  of,  then,  substantially,  16  for  1,  and 
our  silver  legal-tender  dollar  disappeared  from  circulation. 
^N'evertheless  this  coin  was  not  abolished,  and  the  privilege 
of  free  coinao-e  and  the  rijjht  to  tender  the  silver  dollar  for 
debt  remained  the  same  as  before.  The  pivotal  point  of 
this  event  was  the  period  of  depression  which  followed  the 
panic  of  1837.  About  the  period  1863-'73  another  great 
change  in  the  relative  production  of  the  metals  occurred, 
and  gold  instead  of  silver  was  produced  inadequately. 
This  occurrence  began  to  operate  about  the  year  1865, 
when  the  world's  product  of  gold  had  attained  its  max- 
imum. However,  this  change  did  not  appear  to  have  been 
felt  until  some  few  years  afterwards,  when  its  influence 
upon  the  relative  value  of  the  metals  was  greatly  inten- 
sified by  the  threatened  demonetization  of  silver  by  the 
German  Empire  and  its  partial  actual  demonetization  by 
other  European  States.  In  1865  the  relation  of  gold  to 
silver  in  the  London  market  was  1  to  15.33;  in  1872  it  was 
1  to  15.63.  This  is  considered  the  pivotal  point  of  the 
chanare,  because  the  leo-al  relation  of  ajold  and  silver  in 
most  of  the  countries  of  Europe  was  15.50.  In  1874  the 
London  quotation  rose  to  16.15,  and  at  the  present  moment 
it  is  about  17.60,  a  relation  which  shows  that  the  value  of 
gold  to  silver  is  about  10  per  cent,  above  that  fixed  by  our 
law  of  1792,  as  amended  by  the  acts  of  1884  and  1837. 

The  double  standard,  or  the  legal  establishment  of  a 
fixed  relation  between  silver  and  gold,  at  the  calculated 
center  of  their  mutual  oscillations,  is  not  the  unnatural 
and  one-sided  measure  which  some  recent  writers  have 
supposed  it,  but  the  fulcrum  of  a  just  balance  whose  scales 
are  alternately  depressed.  Both  gold  and  silver  are  indis- 
pensable, and  needed  for  the  coins  of  the  world — gold  for 
large  payments,  silver  for  large  and  small  ones;  and  it  will 
be  found  that  in  great  commercial  countries  both  gold  and 
silver  are  needed.  Outside  of  the  great  bulk  of  mankind 
who  use  either  one  or  both  of  those  metals  for  money,  there 


is  a  small  number  on  the  one  side  who  are  too  poor  even 
to  use  silver,  and  a  small  number  on  the  other  who  are  too 
rich  even  to  use  gold.  The  very  poor  employ  copper,  the 
very  rich  paper  notes  and  checks.  In  both  of  these  cases 
the  substitutes  for  gold  or  silver  are  not  real  money,  but 
representatives.  Copper  coins  arc  never  of  full  weight, 
and  are  called  tokens;  paper  instruments  are  intrinsically 
worthless,  and  are  merely  promises,  direct  or  remote,  to 
pay  money  of  gold  or  silver.  To  the  mass  of  mankind 
gold  and  silver  are  both  indispensable  for  the  purpose  of 
exchange,  and  these  two  metals  constitute  the  money  of 
the  world. 

Were  their  quantitative  relation  unknown  or  changing 
always  in  one  direction — for  example,  was  silver  always 
becoming  cheaper  or  gold  dearer — a  double  standard 
would  prove  inconvenient.  But  such  is  not  the  fact.  The 
relation  of  these  metals  to  one  another  for  many  cen- 
turies has  been  very  constant,  the  pivotal  point  being 
15J,  and  the  oscillations — until  within  the  past  year,  and 
chiefly  in  consequence  of  the  demonetization  of  silver  in 
Germany — quite  inconsiderable.  This  constancy  of  rela- 
tion is  due  to  the  stock  of  precious  metals  already  in  the 
world,  to  the  proportion  of  gold  to  silver  needed  for  the 
world's  convenience,  to  the  vicissitudes  of  production,  to 
the  occurrence  of  gold  and  silver  in  the  same  ore  matrices, 
and  to  other  physical  circumstances  which  will  be  adverted 
to  hereafter. 

Without,  perhaps,  fully  knowing  the  causes  of  it,  but 
assured  from  long  experience  of  its  continuance,  nations 
have  hitherto  been  satisfied,  in  their  search  for  an  approx- 
imatively  immutable  measure  of  values,  to  adopt  the  double 
standard,  which,  constituting  a  measure,  now  of  gold  and 
then  of  silver,  nevertheless  served  to  measure  with  constant 
efficiency  any  given  quantum  of  labor  or  its  products;  just 
as  a  peck  measure,  whether  constructed  of  gold  or  silver^ 
will  measure  always  just  one  peck,  or  as  nearly  so  as  the 
different  effects  of  temperature  upon  the  two  metals  will 
permit. 


This  is  what  has  been  understood  in  all  ages  by  the 
double  standard,  and  this  is  what  our  forefathers  under- 
stood by  it  when  they  fixed  it,  first  at  15  and  then  at  16  to 
1,  a  wise  and  far-sighted  mean  between  the  market  relation 
of  silver  and  gold  for  two  generations  previous  to  and  after 
the  date  of  the  three  enactments  which  they  transmitted 
to  us. 

In  case  no  such  amendments  had  been  made  to  the  bill 
now  before  the  Senate,  as  have  been  ofifered  by  the  Sen- 
ator from  Missouri,  it  was  mj'  intention  to  oflfer  a  simple 
amendment  to  restore  the  double  standard  of  the  United 
States,  and  to  base  its  system  of  money  upon  the  money 
of  the  world,  upon  which  it  is  now  not  based.  To  accom- 
plish this  object  it  was  suggested  that  I  might  with  per- 
haps greater  assurance  of  success  attempt  it  by  the  same 
indirection  which  practically  destroyed  the  double  stand- 
ard. But  this  course  might  indicate  a  lack  of  confidence 
in  the  strength  of  the  amendments  or  the  sufiiciency  of 
those  arguments  of  sound  policy  and  expediency  upon 
which  they  rest. 

The  wrong  which  has  been  done  can  never  be  fully  un- 
done by  indirection.  The  undoing  must  be  as  open  and 
explicit  as  the  doing  was  indirect  and  implied. 

To  secure  this  result  nothing  more  is  needed  than  that 
the  history  of  the  precious  metals  shall  be  recalled ;  that 
history  which  is  so  full  of  happiness  and  misery,  of  affluence 
and  of  poverty,  of  ease  and  of  hardship ;  that  history  in  part 
of  which  my  life  has  been  passed,  and  which  has,  there- 
fore, impressed  itself  upon  me  not  only  by  study  but  partly 
also  by  practical  experience. 

The  flood  of  light  which  this  history  throws  upon  the 
subject,  while  it  will  establish  the  necessity  and  importance 
of  the  double  standard,  will  also  serve  to  allay  any  fears 
that  may  be  entertained,  on  the  one  hand,  as  to  the  observ- 
ance of  specie  contracts,  or,  on  the  other,  as  to  the  due 
recognition  of  paper  credit  as  an  economical  and  essential 
element  of  tlj^  currencies  of  modern  nations. 

As  this  history,  be  it  ever  so  briefly  recounted,  is  of  some 


8 

length,  and  as  the  conclusions  to  which  I  desire  to  direct 
attention  are  somewhat  numerous,  I  deem  it  best  at  the 
outset  to  summarize  what  I  propose  to  say  on  this  subject. 

First.  I  propose  to  set  forth  the  function  and  nature  of 
Money,  the  various  substances  which  have  been  used  for 
money,  and  the  characteristics  which  during  fifty  centuries 
of  trials  have  induced  the  precious  metals  as  a  duality  to 
be  always  resorted  to  for  this  purpose  throughout  the 
world. 

Second.  I  propose  to  show  that  the  use  of  money  and 
the  preference  of  the  precious  metals  for  money  were  both 
natural  and  voluntary  acts,  not  due  to  law  or  edict,  and 
that,  therefore,  money  is* of  right,  and  ought  to  be,  free 
and  untrammeled  by  any  regulations  except  of  a  kind 
specified. 

Third.  I  propose  to  trace  the  stock  of  the  precious 
metals  in  the  world  from  the  earliest  period  for  which  we 
have  authentic  data,  to  show  its  mutations  down  to  the 
present  time,  and  the  political,  industrial,  and  social  phe- 
nomena which  accompanied  those  mutations.  From  this 
review  I  expect  to  be  able  to  show  that  the  world's  stock 
of  specie,  which  is  now  of  great  magnitude,  consists  nearly 
one-half  of  silver;  that -any  diminution  or  disuse  of  such 
stock,  whether  resulting  from  failure  of  the  mines  or 
arbitrary  legislation,  is  fraught  with  the  greatest  disasters 
which  can  befall  society;  and  that,  therefore,  the  two 
measures  to  which  our  country  is  committed  by  existing 
laws,  viz:  resumption  in  specie,  combined  with  demone- 
tization of  silver,  are  likely,  if  attempted  to  be  enforced, 
to  end  in  distress  and  defeat. 

Fourth.  Therefore,  one  of  these  measures  will  have  to 
be  abandoned,  and  that  one  is  the  demonetization  of  sil- 
ver. In  other  words,  we  shall  have  to  restore  the  double 
standard  of  gold  and  silver  which  existed  from  1792  to  1873. 

Fifth.  I  next  review  the  relative  value  of  gold  and  silver 
from  the  earliest  times  to  the  present,  and  show  how  con- 
stant that  relation  has  been,  particularly  since  the  discovery 
of  America  and  the  opening  of  the  East  India  and  China 


0 

trades,  since  which  time  and  up  to  1873  it  scarcely  varied 
from  its  pivotal  point  of  15|-  to  1.  The  sources  of  this  long- 
continued  constancy  of  relation  are  then  examined,  and  in 
their  nature  is  found  strong  assurance  that  the  relation  will 
continue  to  he  constant  in  the  future. 

Sixth.  The  principal  and  almost  only  cause  of  aberration 
in  this  relation  is  found  to  be  the  various  edicts  or  enact- 
ments which  in  various  countries  and  at  various  times  have 
interfered  with  the  freedom  of  money.  Prominent  among 
these  were  the  Demonetization  of  silver  in  EngUmd  in  1816, 
the  Monetary  Treaty  of  the  Five  Powers  in  1865,  the  De- 
monetization Act  of  the  United  States  in  1873,  and  the 
pending  measures  of  the  German  Government.  These 
various  measures  are  adverted  to  and  condemned  as  mis- 
chievous interferences  with  trade. 

Seventh.  The  impracticability  of  abolishing  the  double 
standard  is  greatly  strengthened  by  reference  to  the  annual 
supplies  of  gold  and  silver  separately  since  the  beginning  of 
the  present  century.  From  this  reference  it  appears 
that  the  supplies  of  gold  to  the  world  have  fluctuated  be- 
tween $5,000,000  and  ^182,000,000  per  annum,  that  the 
supply  has  been  diminishing  since  1852,  and  that  it  is  at 
the  present  time  insufficient  to  meet  the  demands  of  the 
Avorld  for  that  metal  for  use  in  the  arts  and  to  keep  good 
the  wear  and  loss  of  coin.  On  the  other  hand  the  annual 
supplies  of  silver  have  always  been  steady,  and  are  now 
but  little  above  the  average.  Moreover  gold  is  shown  to 
be  essentially  a  British  product,  while  silver  is  essentially 
American. 

Eighth.  I  then  propose  to  show  the  impossibility  of  re- 
suming specie  payments  in  gold,  the  disadvantages  and 
danger  of  attempting  to  demonetize  silver,  the  impractica- 
bility of  demonetizing  it  permanently,  and  to  discuss  the 
various  objections  that  have  been  urged  against  remonetiza- 
tion. 

Ninth.  I  shall  also  endeavor  to  show  that  the  efi'ect  of 
remonetizing  silver,  or  rehabilitating  the  double  standard, 
will  be  to  equalize  more  nearly  the  values  of  the  metals,  so 


10 

as  to  restore  or  tend  to  restore  the  relation  that  has  hith- 
erto, up  to  within  a  late  date,  existed  between  them  for  three 
centuries,  and  to  afibrd  a  great  impetus  to  the  industrial 
and  commercial  prosperity  of  this  country. 

Tenth.  I  shall  next  endeavor  to  show  that  both  gold  and 
silver  together  at  a  relation  fixed  by  law  is  the  Constitu- 
tional money  of  this  country,  and  that  all  acts  of  legisla- 
tion intended  to  subvert  this  institution  are  illegal  and 
void. 

Eleventh,  and  finally.  I  will  quote  the  authority  of  the 
most  eminent  legislators  and  publicists  in  favor  of  the 
double  standard. 

« 

THE  FUNCTION  OP  MONEY. 

Money  has  been  fitly  described  as  an  instrument  de- 
signed to  equitably  measure  commodities  and  services, 
with  the  view  to  eflect  their  exchange,  either  at  present 
or  in  the  fature,  and  throughout  the  world.  This  is  its 
specific  function,  and  it  has  no  other.  The  money  of  the 
world,  at  the  present  time,  the  substance  in  which  prices 
are  quoted,  contracts  made,  and  debts  lawfully  paid,  con- 
sists of  gold  and  silver  coins;  in  most  countries,  silver  coins 
alone;  in  many  countries,  both  gold  and  silver  coins,  at  a 
relation  of  weight  and  value  fixed  by  law  as  nearly  as 
possible  to  the  market  or  commercial  relation ;  in  a  few 
countries  gold  coins  alone.  In  some  countries  some  form 
of  paper  notes,  either  representing  or  promising  to  pay 
one  or  both  of  the  precious  metals,  are  employed  at  inter- 
vals as  convenient  substitutes,  or  temporary  expedients,  for 
money.  In  some  countries  silver  tokens  or  partly  repre- 
sentative coins;  and  in  all  countries  tokens  of  copper, 
bronze,  or  other  inferior  metals,  are  employed  for  small 
payments.  The  preference  for  silver  and  gold  for  money 
is  the  result  of  thirty  centuries  of  ever}^  conceivable  sort 
of  experiment  to  obviate  the  use  of  the  precious  metals, 
and  for  this  reason,  it  is  deemed  hardly  necessary  in  this 
place  to  advert  more  particularly  to   the  numerous   and 


11 

well-marked  characteristics  which  have  procured  for  the 
precious  metals  this  high  preferment.     Briefly,  these  are  : 

1.  Eligibility  of  voluntary  interchange  into  and  with 
other  forms  of  capital.  This  is  the  first  and  most  neces- 
sary characteristic  of  money,  the  one  without  which  it 
must  prove  useless.  If  its  interchangeability  instead  of 
being  voluntary  is  merely  sustained  by  law,  the  money 
cannot  equitably  measure  future  exchanges,  for  human  law 
is  mutable  and  subject  to  vicissitude,  alteration,  and  over- 
throw. If  its  interchangeability  is  costly,  as  it  would  be 
if  the  money  were  made  of  iron  or  cotton,  the  money 
would  be  of  inferior  eligibility  to  money  made  of  the 
precious  metals,  which  are  easily  and  cheaply  convertible 
from  coins  into  plate  and  other  forms  of  capital,  and  from 
these  forms  into  coins. 

This  quality  of  voluntary  and  economical  interchange- 
ability  furnishes  constant  security  to  the  holder  of  gold 
and  silver  money  :  a  security  which  no  act  of  legal  tender 
can  enhance.  Money  possessing  this  and  the  other  charac- 
teristics hereafter  named  needs  no  law  to  make  it  current 
throughout  the  world.  It  is  these  characteristics  which 
alone  can  give  it  currency;  not  the  force  of  law,  which  is 
only  the  force  of  one  nation  at  one  time  and  as  modified 
by  the  defects  of  administration  and  the  friction  of  evasion. 
Since  the  arts  of  smelting  and  reSning  iron  and  the  other 
more  common  and  now  more  useful  metals,  and  of  making 
china  and  glass,  were  discovered  and  perfected,  the  forms 
of  capital  into  which  the  precious  metals  can  be  econom- 
ically converted  are  perhaps  less  numerous  or  important 
than  formerly,  many  of  the  materials  or  instruments  of 
reproduction  or  ornamentation  which  are  now  made  of 
iron,  glass,  etc.,  having  been  formerly  made  of  the  precious 
metals;  for  example,  saddlery-hardware,  buttons,  buckles, 
thimbles,  bells,  lamps,  goblets,  plates,  ewers,  basins,  etc. 
Nevertheless  the  usi?  of  the  precious  metals  for  these  and 
other  and  newer  purposes,  whence  they  are  readily  con- 
verted into  coin,  is  still  very  important,  as  e.  g.  watchmak- 
ing, plate  and  plated  ware,  jewelry,  regalia,  pens,  dentistry. 


12 

etc.  They  ate,  also,  largely  employed  in  photography, 
sign-painting,  bookbinding,  printing,  medals,  etc. 

The  security  thus  aiforded  to  the  owner  of  gold  and  sil- 
ver money  is  not  merely  confined  to  an  assurance  that  he 
may  obtain  for  it  at  the  present  time  and  anywhere  a  full 
equivalent  for  the  commodities  or  services  it  costs;  it  ex- 
tends that  assurance,  or  the  nearest  possible  approximation 
to  it,  over  all  time.  The  cheap  convertibility  of  such 
money  into  other  and  numerous  forms  of  usefulness  is  a 
check  against  the  heaping  up  of  such  money;  the  cheap 
convertibility  of  plate,  and  many  of  the  other  forms  into 
which  the  precious  metals  are  usually  cast,  is  a  check 
against  the  depletion  of  such  money.  The  relation  between 
the  supply  and  demand  for  the  precious  metals  is  by  no 
means  a  constant  one  as  to  either  or  both  metals;  this 
relation  varies,  but  the  variation  is  less,  and  is  spread  over 
longer  periods  of  time  than  is  the  case  with  any  other 
commodity.  Did  the  precious  metals  possess  no  other 
advantage  over  other  commodities  which  might  be  sug- 
gested as  useful  for  money,  this  one  of  minimum  varia- 
bility, alone,  would  be  sufficient  to  render  them  pre-emin- 
ently fitted  for  that  purpose. 

2.  Adequateness  and  steadiness  of  supply  to  the  world. 
These  characteristics  are  shared  with  the  precious  metals  by 
many  other  commodities  or  instruments  capable,  or  supposed 
to  be  capable,  of  measuring  present  and  future  values.  On 
the  other  hand,  there  are  others  which  do  not  share  it,  as,  the 
principal  articles  of  food,  clothing,  and  shelter,  whose  in- 
adequacy and  unsteadiness  are  proved  by  the  limits  which 
their  supply  puts  upon  population;  it  having  been  demon- 
strated that  population  would  double  in  at  least  every  twenty- 
five  years,  did  the  supply  of  the  means  of  subsistence  per- 
mit. Even  the  precious  metals  themselves  have  sometimes 
failed  of  adequate  or  steady  supply,  and  never  without 
occasioning  the  direst  calamities ;  but  the  danger  is  less 
with  them  than  with  any  other  commodities  known  to  man, 
botli  because  of  their  profuse  and  difiused  distribution  in 
the  earth  and  of  their  lasting  qualities  when  produced. 


13 

3.  DifFasion  of  supply  and  consumption  throughout  the 
world  and  ease  of  recover}'.  The  precious  metals  are  found 
in  all  countries  and  used  in  all  countries  for  purposes  other 
than  money.  The  diffusion  of  their  supply  and  consump- 
tion is  greater  than  that  of  any  other  commodities.  In 
some  countries  there  is  no  iron,  in  others  no  cotton,  in 
others  no  wool,  in  others  no  grain  can  be  grown  or  cattle 
raised,  and  aven  in  many  countries  where  iron  is  found 
there  is  no  fuel  for  smelting  it.  The  competition  in  smelt- 
ing causes  it  to  be  essentially  a  monopoly  in  countries  pos- 
sessing the  cheapest  fuel.  Similar  considerations  affect  all 
commodities,  but  gold  and  silver  the  least.  These  metals 
are  often  found  in  a  pure  state,  and  were  obtained  in  the 
early  ages  of  mankind  with  the  aid  of  a  flint-chisel  and 
sometimes  even  with  the  fangs  of  a  boar.*  It  is  within 
the  power  of  the  humblest  and  most  solitary  adventurer 
to  extract,  refine,  and  coin  these  metals,  processes  which 
can  be  pursued  with  the  other  metals  only  by  the  help  of 
co-operation  and  capital.  The  supply  of  the  money  of  the 
world  must  be  a  monopoly  to  no  country  and  to  no  class 
of  men;  otherwise  the  fortunes  of  all  the  rest  might  stand 
in  imminent  jeopardy  from  those  who  monopolized  it. 

4.  Exemption  from  decay.  The  precious  metals  will 
neither  decay,  corrode,  oxydize,  nor  evaporate.  They  re- 
sist not  only  the  atmosphere,  but  the  strongest  acids. 
There  is  still  extant  a  legible  specimen  of  gold  coins  issued 
in  Ionia  about  nine  centuries  before  Christ,  f  There  was 
a  legible  stamped  gold  coin  in  the  Earl  of  Pembroke's 
collection  which  was  issued  by  Darius,  of  Persia,  about  480 
years  before  Christ*  The  gold  coins  of  Alexander  the 
Great,  about  330  B.  C,  which  have  never  been  excelled  in 
purity  of  metal  or  boldness  and  beauty  of  design,  are  still 
so  abundant  that  collectors  regard  them  as  less  rare  than 
any  American  gold  piece^f  the  last  century.  §  There  are 
legible  silver  coins  still  circulating  in  England  which  were 
issued  by  the  governments  of  ancient  Rome,  || 

*  Jacob,  17.  tApp.  Cyc,  12,  p.  443.    §  App.  Cyc,  12,  p.  444.    picLeod. 


14 

III  times  of  war  and  civil  commotion,  when  the  solemn 
earth  becomes  the  womb  of  man's  rehabilitation,  as  it  had 
once  been  that  of  his  existence,  and  is  alwaj's  that  of  his 
support,  the  quality  of  exemption  from  deca}'-  of  the  pre- 
cious metals  is  not  the  least  valuable  one,  nor  are  these  the 
only  times  when  such  a  characteristic  proves  valuable. 
Accidents  from  fire,  water,  and  many  other  causes  are 
continually  happenin<2:  to  destroy  man's  possessions;  but 
the  precious  metals  survive  them  all. 

5.  The  two  precious  motals  are  naturally  complement- 
ary to  each  other.  Hitherto  the  precious  metals  have  been 
mentioned  together,  and  the  advantages  ascribed  to  them 
attributed  to  both.  This  is  quite  correct  if  both  be  taken 
together,  but  not  entirely  so  if  either  metal  is  taken  singly. 
Some  countries  which  produce  gold  do  not  produce  silver; 
as  Great  Britain  nnd  its  colonies.  Others  produce  more 
silver  than  gohl,  as  the  United  States,  Mexico,  and  the 
South  American  States.  In  others,  again,  the  gold  and 
silver 'occur  in  the  same  matrix,  as  in  the  Corastock  lode. 
Some  countries  consume  little  or  no  gold;  others  little  or 
no  silver.  Hence  the  distribution  of  supply  and  demand 
varies;  so  does  its  steadiness.  During  certain  periods  of 
time  the  world's  current  supply,  as  compared  with  its  cur- 
rent consumption,  of  silver,  outruns  that  of  gold,  as  it  did 
from  the  beginning  to  nearly  the  middle  of  this  century. 
During  other  periods  gold  outruns  silver,  as  from  about 
the  year  1837  to  1870.  Thus,  taken  separately,  the  pre- 
cious metals  do  not  exhibit  those  advantages  which  they 
possess  together.  Moreover,  in  many  countries,  the  use  of 
both  metals  for  money  is  rendered  necessary  by  reason  of 
their  very  different  value  as  compared  with  bulk  or  weight. 
These  considerations  will  be  alluded  to  again;  thev  are 
only  mentioned  in  this  place  in  order  to  justify  the  em- 
ployment of  the  dual  term  precious  metals,  and  to  account 
for  their  forming  together  tho  money  of  the  world. 

6.  The  superior  ductility  and  malleability  of  the  pre- 
cious metals  is  one  of  the  most  important  of  their  charac- 
teristics, for  it  renders  the  cost  of  manufacturing  coins  so 


15 

small,  as  practically  to  entail  no  loss  upon  the  owners  in 
case  it  became  desirable  to  reduce  them  to  bars.  This  is 
always  the  case  when  legal  enactments  place  a  false  or  mis- 
taken value  (as  respects  commodities  or  services  already 
sold,  or  contracted  to  be  sold  in  future)  upon  the  coins. 
The  comparative  cheapness  and  ease  of  transforming  the 
coins  into  bars,  in  which  form  the  metal  is  certain  to  com- 
mand its  true  market  value,  affords  a  continual  check 
upon  legislation  and  defeats  its  every  attempt  to  misvalue 
coins.  Metals  possessing  inferior  ductility  are  lacking  in 
this  advantage,  the  cost  of  making  them  into  coins  and 
the  loss  by  reducing  them  to  bars  proving  an  obstacle  to 
their  quick  and  ready  transmutation.  Substances  other 
than  metals  do  not  possess  this  characteristic  at  all.  The 
cost  of  manufacturing  coins  is  called  brassage,  and  is  about 
^  of  1  per  cent.  In  some  countries  another  and  wholly  in- 
defensible charge,  in  addition  to  this,  is  imposed.  It  is 
called  seigniorage,  and  consists  of  brassage  and  a  profit. 
This  profit  is  a  royal  prerogative,  and,  as  its  name  indicates, 
is  a  relic  of  the  feudal  ages  of  medieval  Europe. 

There  are  other  well  marked  characteristics  which  ren- 
der the  precious  metals  superior  to  all  other  instruments 
or  services  susceptible  of  being  employed  to  measure  values. 
The  homogeneity  of  these  substances  renders  their  genuine- 
ness and  purity  easy  to  test  and  difficult  to  counterfeit  or 
impair;  enables  all  bodies  of  them,  however  large  or  small, 
easy  to  divide  or  unite,  and  without  adding  to,  or  dimin- 
ishing, the  labor  or  service  which  they  represent.  They 
are  easier  to  transport  and  conceal,  less  liable  to  abrasion, 
and,  being  inodorous,  are  less  offensive  to  handle  than 
other  substances. 

It  is  difficult  to  estimate  what  relation  the  cost  of  this 
instrument  bears  to  that  of  the  commodities  and  services 
it  measures,  because  the  commerce  of  the  world  is  carried 
on  largely  by  means  of  pa^er  instruments,  some  of  which 
are  indeed  based  upon  the  metals  and  merely  represent 
them,  while  others  are  based  upon  private  or  corporative 
credit,  and  still  others  on  no  credit  at  all  but  mere  force  of 


16 

law.  There  is  another  difficulty  iu  making  such  a  calcu- 
lation: that  which  arises  from  the  well-known  fact  that  a 
vast  number  of  the  largest  transactions  consist  of  stock- 
jobbing, or  mere  bets  clothed  in  the  garb  of  business  op- 
erations. Making  a  reasonable  allowance  for  these  facts,  it 
has  been  calculated  that  specie  measures  ten  thousand  times 
its  own  value  every  year,  and  that  taking  gold  and  silver 
together  in  the  actual  proportions  in  which  they  exist  in  the 
currencies  of  the  world,  specie  will  last,  as  against  abrasion, 
loss  by  accident,  &c.,  about  a  thousand  years.*  Upon  this 
basis  the  actual  cost  of  this  instrument  is  an  infinitessimal 
charge  upon  each  transaction,  probably  as  little  as  that 
caused  by  the  wear  and  tear  of  any  other  measure,  as  a 
tape-line,  a  pint-pot,  a  buShel-basket,  &c. 

On  the  other  hand,  money  made  of  the  precious  metals 
has  several  defects.  It  is  somewhat  costly  to  produce,  it 
is  somewhat  expensive  to  transport.  It  is  always  a  mis- 
fortune to  society,  as  well  as  to  the  individual,  when  specie 
is  lost  at  sea,  or  buried  in  hoards  the  secret  of  which  does 
not  transpire.  It  is  subject  to  loss  from  abrasion,  it  fluc- 
tuates in  value,  and  the  two  metals  fluctuate  unevenly. 

Some  of  these  defects  have  been  remedied  by  the  inven- 
tion of  expedients.  Transportation  and  loss  are  measurably 
obviated  by  bills  of  exchange  and  places  and  certificates  of 
deposit;  abrasion  is  lessened  by  the  use  of  alloy  in  coins; 
the  uneven  fluctuation  of  the  two  metals  is  remedied  by  a 
double  standard,  which,  by  fixing  a  mean  relation  cover- 
ing a  long  period  of  time,  past  and  prospective,  enables 
both  metals  at  that  relation  to  be  employed  all  the  time. 

There  remain  two  other  detects:  the  first  cost  of  the 
precious  metals  and  their  fluctuating  value  as  a  duality 
even  after  such  fluctuation  has  been  lessened  by  using 
them  together.     These  defects  are  extremely  small   and 

'*' According  to  Jacob,  the  stock  of  coin  in  Europe  at  tlie  beginning 
of  tlio  present  era  received  little  or  no  addition  until  the  Discovery  of 
America.  This  was  a  period  of  fifteen  hundred  years,  during  which  the 
stock  dwindled  down  to  little  more  than  ten  per  cent,  of  its  original 
dimensions. 


17 

are  of  a  nature  which  renders  them  unavoidable  by  any 
safe  or  practicable  means. 

Let  us  begin  with  the  question  of  cost.  Present  and 
future  values  cannot  be  equitably  or  nearly  equitably  meas- 
ured by  anything  that  is  not  capable  of  being  voluntarily 
and  readily  interchanged  with  other  forms  of  capital;  in  a 
word,  by  anything  that  of  itself  does  not  contain  or  repre- 
sent an  amount  of  labor  or  service  easy  to  determine,  and 
of  a  kind  appreciable  to  and  exchangeable  with  all  mankind. 

Value,  which  is  not  to  be  confused  with  either  worth, 
utility,  or  desirability,  is  the  quantitative  relation  between 
two  services  exchanged.*  This  relation  can  only  arise  in 
the  social  state;  whilst  worth,  utility,  and  desirability 
are  qualities  appreciable  to  the  isolated  man  as  well 
as  to  society.  Value  is  not  a  quality  inherent  in  a  service; 
as  worth,  utility,  and  desirability  are;  it  is  simply  a  relation 
between  two  services  exchano;ed. 

A  measure  of  value  must  therefore  be  a  service  of  some 
sort,  and  the  more  universally  such  service  is  appreciated 
the  better  measure  will  it  afford.  An  abstraction,  as  an 
imaginary  money  of  account  or  an  irredeemable  credit, 
caimot  measure  the  quantitative  relation  between  two  ser- 
vices, and  hence  cannot  be  a  measure  of  value. 

There  is  an  easy  method  of  testing  this  assertion.  Repeal 
the  promise  of  payment  which  now  causes  treasury  notes 
to  usurp  the  place  of  specie,  and  observe  what  kind  of 
money  wnll  continue  current  and  what  not.  It  will  then 
be  seen  that  the  precious  metals  will  circulate  as  before 
without  the  least  abatement,  indeed,  with  a  slight  enhance- 
ment of  their  purchasing  power.  This, indeed,  is  the  case 
in  China,  a  country  which  tried  fiat  currency  six  hundred 
years  ago,  but  in  which,  in  spite  of  the  fact  that  there  are 
now  neither  legal  tender  nor  coinacre  laws,  srold  and  silver 
both  circulate  at  even  a  hitrher  value  than  in  countries 
where  such  laws  are  in  full  force  and  effect. 

If  the  impracticability  of  employing  irredeemable  credit 
_ — 4 „ 

*Bastiat,  Hannoiiies  Polit.  Econ,  pp.  108-9. 


18 

for  the  purpose  of  raone}'  be  admitted,  and  it  is  still 
claimed  that  some  form  of  redeemable  credit,  as  national, 
or  bank,  or  individual  notes,  may  with  advantage  be  used 
as  money  in  order  to  save  the  cost  of  the  precious  metals, 
the  claim  is  admitted.  There  is  and  can  be  no  objection 
to  the  use  of  such  credit,  so  long  as  its  use,  like  that  of  the 
Scotch  bank  notes,  is  entirely  voluntary.  The  moment 
that  legislation  or  any  arbitrary  act  interferes  to  place  it 
above  this  level,  its  use  is  fraught  with  danger.  The  advan- 
tage to  be  gained,  which  is  merely  that  of  saving  the  cost 
of  the  precious  metals  in  a  currency  of  safe  and  universally 
acceptable  material,  is  wholly  inadequate  to  the  risk  run. 
And  on  this  point  it  is  never  to  be  lost  sight  of  that  so 
long  as  we  continue  to  be,  as  we  are,  one  of  the  principal 
producers  of  the  precious  metals,  we  lower  to  a  small  ex- 
tent the  value  and  selling  price  of  all  the  metal  we  may 
have  to  export,  by  every  expedient,  the  effect  of  which  is  to 
throw  it  out  of  employment  in  our  own  country. 

In  saying  this,  it  is  not  intended  to  deny  the  advantage 
of  employing  credit  as  a  convenient  and  economical  medi- 
um of  exchange;  but  such  credit  must  rest  upon  so  firm 
and  broad  a  foundation  of  the  precious  metals  as  not  to 
need  the  aid  of  legislation  to  prop  it  up.  In  other  words, 
its  use  must  rest  upon  the  same  foundation  as  the  use  of 
the  precious  metals  themselves — common  and  voluntary 
consent. 

As  to  the  other  unavoidable  defect  of  money  made  of 
the  precious  metals,  its  fluctuating  value,  it  can  only  be 
replied  that  this  fluctuation  is  exceedingl}^  slow.  That  is 
all  the  defense  of  it  there  is,  and  there  can  be  no  better 
one,  for  all  measures  of  value  must  fluctuate,  though  none 
of  them  less  than  the  precious  metals.  There  are  men  who 
have  imagined  an  absolute  and  fixed  measure  of  value,  as 
there  have  been  others  who  imagined  a  fixed  earth  or  a 
fixed  sun,  an  absolute  or  unconditioned  quality  or  quan- 
tity, etc.  To  such  men  it  need  only  be  replied  that  there 
is  nothing  fixed  or  absolute;  nothing,  at  least,  that  the 
senses  of  man  can  perceive  or  his  mind  imagine.     All  is  in 


19 

motion,  all  is  conditioned.  The  universe  and  all  it  con- 
tains is  incessantl}''  in  action,  and  even  the  adjectives  of 
language  which  are  emploj-ed  to  qualify  or  characterize 
the  objects  brought  to  our  conception,  are  themselves  rela- 
tive and  conditioned.  A  fixed  measure  of  value  is  an  in- 
conceivability; we  can  but  prefer  for  such  a  measure  the 
commodities  or  services  which  fluctuate  in  value  the  least, 
and  these  are  the  precious  metals. 

This  brief  exposition  of  the  functions  and  characteristics 
of  money  may  be  still  more  briefly  summarised  as  follows: 

1.  Money  is  an  instrument  voluntarily  adopted  to  equit- 
ably measure  values,  present  and  future. 

2.  Value  is  the  relation  between  two  commodities  or  ser- 
vices exchanged. 

3.  Hence  money  is  the  measure  of  the  relation  between 
commodities  and  services  exchanged. 

4.  This  measure  is  formed  most  conveniently  and  equi- 
tably of  both  the  precious  metals  taken  together. 

5.  Legislation  cannot  make  or  unmake  money.  It  mav 
temporarily  exalt  or  depress  the  value  of  one  metal  as 
against  the  other,  but  only  temporarily;  it  may  disturb, 
but  it  cannot  permanently  alter  or  destroy.  Gold  and  sil- 
ver are  money  in  virtue  of  their  own  superiority,  and  they 
owe  none  of  their  rank  to  law. 

The  extent  to  which  legislation  can  be  beneficially  exer- 
cised with  regard  to  money  is  to  quantitatively  define  the 
names  of  coins,  to  guard  against  confusion,  counterfeiting, 
etc.,  by  manufacturing  them  in  a  public  mint,  and  to  save 
the  transportation  and  abrasion  of  them  by  receiving  then* 
on  deposit  and  issuing  certificates  therefor.* 

To  insure  the  fourth  provision,  that  both  the  precious 
metals  shall  form  the  ingredients  of  money,  it  is  essential 
that  no  legal  obstacle  shall  be  placed  in  the  way  of  the 
voluntary  use  of  either;  that  one,  equally  with  the  other, 
shall  be  a  legal  tender  to  an  unlimited  amount,  at  a  quanti- 
tative relation  fixed  from  time  to  time  in  view  of  the  past 

"Herbert  Spencer,  iii  X.  Y.  Social  Science  Review,  p.  137. 


20 

and  probable  faUire  market  ratio  of  these  metals.  To 
these  must  be  added  copper  tokens  for  petty  sums,  and  upon 
the  whole  will  naturally  arise  a  paper  credit  peculiar  to 
each  country ;  a  credit  whose  volume  will  regulate  itself 
in  view  of  the  basis  beneath  it,  in  view  of  its  command  of 
the  precious  metals,  in  view  of  the  wants  of  industry  and 
of  the  conditions  of  security  which  exist  within  the  social 
or  political  organization  to  which  it  belongs. 

These  are  the  essential  principles  of  money  which  seem 
to  be  deducible  from  the  united  testimony  of  history,  ex- 
perience, and  reflection.  When  we  come  to  apply  these 
principles  to  any  existing  monetary  system  not  in  ac- 
cordance with  them,  as  is  the  case  with  that  of  this  country, 
we  are  in  the  position  of  a  physician  who,  believing  him- 
self to  be  acquainted  with  the  laws  of  health,  may  never- 
theless be  puzzled  how  to  prescribe  for  a  given  case  of 
disease.  Happily  I  have  no  such  task  before  me.  My 
single  object  is  to  remove  an  impediment  to  recovery,  an 
impediment  the  nature  and  importance  of  which,  will,  I 
believe,  be  recognized  as  promptly  by  those  who  may  differ 
with  me  as  to  what  are  the  true  principles  of  money,  as  by 
those  who  may  agree  with  me  in  regard  to  those  principles. 
The  removal  of  this  impediment,  while  it  will  afford  that 
ease  which  one  school  of  currency  demands,  nevertheless 
affords  it  entirely  within  the  scope  of  action  which  the 
other  school  prescribes.  It  simply  proposes  the  re-estab- 
lishment of  the  double  standard,  unwisely  abolished  by 
the  act  of  1873,  a  piece  of  legislation  whose  evil  effects  can 
only  be  estimated  by  referring  to  that  history  of  money 
from  which  I  have  ventured  for  a  few  moments  to  digress. 

These  views  are  not  merely  those  of  the  ablest  men  who 
have  devoted  their  attention  to  the  subject;  they  are  gath- 
ered from  the  history  of  money  from  the  time  when  this 
instrument  was  first  known  to  mankind,  to  the  present. 
They  are  enforced  not  only  by  precept,  but  by  example; 
they  are  written  in  the  rise  and  fall  of  States  and  of  social 
systems,  in  revolutions,  in  wars,  in  the  annals  of  freedom 
and  in  those  of  feudalism  and  slavery.    They  are  imprinted 


21 

in  sweat,  and  tears,  and  blood;  and  to  disregard  them  is  to 
disregard  the  lessons  of  thirty  centuries  of  time. 

The  use  of  gold  and  silver  for  money  is  not  a  recent 
one,  neither  were  these  costly  metals  adopted  for  the  pur- 
pose until  after  every  other  expedient  practicable  at  the 
time  had  been  tried.  The  following  table  furnishes  a  list 
of  these  expedients  and  other  chronological  data  in  refer- 
ence to  money : 

Table  showing  some  of  the   Substances  which  have  at  various  periods 
and  in  various  countries  been  used  as  Monei/. 


Period. 

COUNTEY. 

B.  C. 

1900 

Palestine. 

Arabia. 

Phoenicia. 

Plioenician  colony 

in  Spain. 

1200 

Phrygia. 

1184 

Greece. 

8fi2 

Argos. 

700-500 

Rome. 

578 

Rome. 

Uacertain. 

Carthage. 

491 

Sicily. 

480 

Persia. 

478 

Sicily. 

407 

Athens. 

400 

Sparta. 

360 

Macedonia. 

266 

Rome. 

54 

Britain. 

50 

Home. 

Uncertain. 

Arabia. 

Substance  used  as  monet. 


A.D. 

212 
106G 


IICO 

1240 
1275 


1470 

1574 
Uncertain. 
Uncertain. 
Uncertain. 


Cattle; and  gold  and  silver  by  w't. 
Gold  and  silver  coins. 
Gold,  silver  and  copper  coins. 
Same,  (some  still  extant.) 

Coins  by  Queen  of  Pelops. 
Brass  coin.s. 

Gold  and  silver  coins  by  Phidon. 
Brass  by  weiglit. 
Copper  coins. 

Leather  or  parchment  money,  first 
"  paper  bills  "  known. 


Gold  coins   by  Gelo,  (some  still 

extant.) 
Gold  coins  by  Darius,  (two  still 

extant.) 
Gold  coins  by  Hiero,  (some  still 

extant.) 
Debased  gold  coins,  foreign. 
Iron,  over  valued. 
First  gold  coins  coined  in  Greece 

by  Phillip. 
First  silver  coins  coined  in  Rome. 
Pieces  of  iron. 
Tin  and  brass  coins. 
Glass  coins. 


Period  following  the  failure  of  the  ancient  mines. 


Rom3.  (Caracalla.) 


Britain 


Italy. 


Lead  coins  .silvered  and  copper 
coins  gililed. 

Living  money,  or  human  beings 
made  a  legal  tender  for  debts  at 
about  £2  U'is.  M.,  per  capita. 


Period  of  representatives  for  money. 


Milan,  Italy. 
Ciiina. 
Africa,  part  of 

Grenada,  Spain. 
Holland. 
Iceland. 
Newfoundland. 
Norway  and  Green- 
land. 


Paper  invented;  bills  of  exchange 
introduced  by  the  Jews. 

Paper  bills  a  legal  tender. 

Paper  bills  a  legal  tender. 

"Machntfs"  or  "ideal  money." 
This  view  doubted. 

Paper  bills  a  legal  tender. 

Pasteboard  bills,  representative. 

Dried  fish. 

Codfish,  dried. 

Seal  skins  and  blubber. 


AUTHOEITT. 


The  Scriptures. 
Jacob. 

Ancnymous. 
Carter. 

Julius  Pollux. 

Homer, 

Die.  of  Dates. 

Jacob. 

Ibid. 

Socrates,  Dial,  on 
Riclies,  Jourp'l 
des  Economistr 
es,  1874,  p.  354. 

Jacob. 

Ibid. 

Ibid. 

McLeod,  476. 

BcBckh. 

Jacob. 

Ibid. 
Ibid. 

Die.  of  Dates. 
N.  Y.  Tribune, 
July  2,  1872. 


Anonymous. 

Henry's  History  of 
Great    Britain, 
vol.  iv,  p.  24.3. 


Anderson. 

.\rthur  Young. 
Marco  Polo. 
Montesquieu. 

Irving. 

Die.  of  Dates. 

.\nonymons. 

Anonymous. 

Anonymous. 


22 

Table —  Continued. 


Peeiod. 

Country. 

SOBSTANCB  USED  AS  MONEY. 

Authority. 

Uncertain. 

Hindostan   and 
parts  of  Africa. 

Cowrie  shells. 

Jacob,  372. 

Uncertain. 

North  America,  In- 

Agate, cornelian,  jasper,  lead,  cop- 

Anonymous. 

dian  Tribes. 

per,    gold,    silver,    terra -ootta, 
mica,  pearl,  lignite,  coal,  bone, 
shells,    chalcedony,    wampum- 
peag,  etc. 

Uncertain. 

Oriental   pastoral 

tribes. 

CHttle,  grain,  etc. 

Anonymous. 

U  :.certain. 

Abyssinia. 

Salt. 

Anonymous. 

Uncertain. 

China  and  India. 

Kice. 

Anonymous. 

Uncertain. 

India. 

Paper  bills. 

Patterson,  p,  13. 

Uncertain. 

China. 

Pieces  of  silk  cloth. 

Ibid. 

Uncertain. 

Africa. 

Strips  of  cotton  cloth. 

Ibid. 

Not  stated. 

Wooden  tallies  or  checks. 

Ibid. 

A.D. 

1631 

1635 
1690 
1694 
1700 

1702 
1712 
1716 

1723 
1732 

1732 

1776 
1785 


1810-1840 
1826 
1847 

18J9 


1855 
185- 


Period  following  the  discovery  of  the  American  mines. 


Massachusetts. 

Massachusetts. 

Massachusetts 

England. 

Sweden. 

South  Carolina. 
South  Carolina. 
France. 

Pennsylvania. 
Maryland. 

Maryland. 

Scotland. 
Frankland,    State 

of,  (now  part  of 

North  Car.) 


Corn    a   legal  tender  at    market 

prices. 
Musket  balls. 
Paper  bills,  colonial  notes. 
Bank  notes. 
Copper  and  iron  coins. 

Colonial  notes. 

Bank  notes. 

Inter-convertible  paper  bills  a  le- 
gal tender. 

Paper  bills,  colonial  notes. 

Indian  corn  a  legal  tender  at  23(i. 
per  bushel. 

Tobacco  a  legal  tender  at  Id.  per 
pound. 

Tenpenny  nails'  or  small  change. 

Linen  at  3s.  Gfi.  per  yard,  vyhisky 
at  2.S.  M.  per  gallon,  and  peltry 
as  legal  tenders. 


Period  following  the  failure  of  the  American  mines. 
Great  era  of  bank  paper  bills. 


.\11  commercial 

countries. 
Russia. 

.VIexico,  parts  of. 


Platinum  coins,  (discontinued  in 

1845.) 
Cocoa  beans,  and  at  Castle  of  Pe- 

rote,  soap. 


Macgreggor. 

Anonymous. 
Macgreggor. 
McCulloch. 
Voltaire's  "Charles 

XII." 
Macgreggor. 
Ibid. 
Murray. 

Macgreggor. 
Anonymous. 

Anonymous. 

Adam  Smith. 

Wheeler's  History 
of  North  Caro- 
lina, 94. 


App.  Eneyc. 
Anonymous. 


Period  following  the  openings  of  California  and  Australia. 


Galiforuia. 


Australia. 

'Communist  settle- 
ment in  Ohio 
called  ■'  Utopia." 


Gold  dust  by  weight,  also  minute 
gohl  coins  forsmall  change  coin- 
ed in  jM'ivate  mints. 

Gold  dust  by  weight. 

Paper  bills  each  representing 
"one  hour's  labor." 


Private 
tion. 


informa- 


Period  following  the  suspension  of  specie  payments  in  the  United  States. 


1862 

United  States. 

Paper  bills  a  legal  tender. 

Actof  Feb.  25. 

1863 

North  Carolina. 

Tenpenny  nails,  at  5  cents  each, 
for  small  change. 

Anonymous. 

1863 

Campat  Florence, 

Potatoes  for  small  change. 

Yorkville    Enquir- 

South Carolina. 

er. 

1863 

L'liited  States. 

Postage  stamps  for  small  change, 

temporarv. 

- 

1865 

Philadelphia,  Pa. 

Turnips  for  small  change,  tempo- 

Philadel.   Ledger, 

rarv  and  local. 

April. 

1865 

United  St.ates. 

Nickel  coins  for    small  change, 
overvalued. 

Act  of  March  3. 

23 

It  will  be  observed  that  the  comraodities  selected  to 
serve  the  purpose  of  monej  during  those  early  ages  when 
the  countries  of  the  world  were  not  connected  hy  com- 
merce were  always  those  of  adequate,  steady,  and  diffused 
supply,  and,  therefore,  of  most  common  acceptation  in 
each  country.  Thus,  in  forestal  ages,  the  skins  of  wild 
animals  were  usually  employed;  in  pastoral  ages,  cattle;  * 
in  early  agricultural  ages,  graiu ;  in  early  raining  ages, 
base  metal;  in  early  manufacturing  ages,  glass,  musket- 
balls,  nails,  strips  of  cotton,  etc. 

The  significance  of  this  deduction  will  not  fail  to  be 
appreciated.  After  commerce  had  connected  various 
countries,  substances  common  to  all  countries,  viz  :  the 
precious  metals,  were  found  to  be  necessary  for  the  pur- 
pose of  money,  and  later  still,  balances  of  trade  were  settled 
by  means  of  bills  of  exchange  representing  those  metals; 
and  it  is  worthy  of  remark  that  gold  and  silver  are  the 
only  substances  which  have  ever  been  universally  used 
for  money. 

Development  from  the  early  agricultural  to  the  mining, 
manufacturing,  and  commercial  ages  indicates  not  only  a 
development  of  occupation,  but  also  a  development  of  po- 
litical organization.  The  hunter,  the  shepherd,  the  early 
agriculturist,  needed  neither  social  oganization  nor  govern- 
ment. He  could  prosecute  his  occupations  alone;  and 
in  these  stages  of  development  mankind  lived  in  isolated 
families  or  small  tribes  of  freemen.  The  progress  of  agri- 
culture and  of  mining,  which  must  have  followed  agricul- 
ture,t  of  manufacturing  and  of  commerce,  rendered  fixed 
residences  and  division  of  labor  necessary,  and  the  protec- 
tion of  the  one  and  regulation  of  the  other  demanded  the 
offices  of  government.  The  hunter  and  shepherd  could 
defend  himself  and  his  possessions  or  convey  them  out  of 


*  Shekel,  a  lamb ;  2'ec!<s,  (whence  pecunia,  pecuuiarj",  etc..)  cattle; 
fcoh,  (wiicnoe  fee,  Saxon,  German,  etc.,)  cattle. 

i  Minin;?  doubtless  oi-ij^inated  in  that  upturning  of  tiie  soil  which  oc- 
curs iu  the  pursuit  of  agricultun^  Indeed,  historj^  affords  an  instance  of 
the  l<ind.  "In  P;\3onia  the  luisbandinan,  wlille  plowin;?.  fonml  pieces  of 
gold."     Strabo,  Yll,  (Ciu-estom,)  p.  331,  as  quoted  in  Boeckh,  p.  10. 


24 

the  reach  of  enemies  ;  the  agriculturist,  miner,  manufac- 
turer and  merchant,  needed  the  protection  of  a  military 
force  and  the  security  of  well-executed  laws. 

Following  the  local  or  feudal  powers  which  sprang  into 
existence  to  meet  these  demands,  came  also  those  abuses, 
which  always,  sooner  or  later,  accompany  the  exercise  of 
power. 

The  warrior  classes  reduced  the  working  classes  to  a 
condition  of  predial  servitude,  and  those  who  at  first  were 
mere  chieftains  of  choice  became  arbitrary  and  despotic 
lords  paramount.  Not  least  among  the  powers  which  they 
abused  were  those  relating  to  the  coinage  and  denomina- 
tion of  the  precious  metals. 

Up  to  this  period  in  the  history  of  countries  it  is  to  be 
remarked  that,  whatever  substance  came  to  be  employed 
foy  money  in  each  country,  whether,  as  at  first,  the  peculiar 
and  most  common  product  of  each  respective  country,  or, 
as  afterward,  those  substances  more  or  less  common  to  all 
countries  and  most  couvenienteverywhere,  viz.,  the  precious 
metals,  such  substance  was  employed,  as  it  is  now  in  China, 
without  command  or  force  of  law.  The  importance  of  this 
fact  cannot  be  overestimated,  for  its  recognition  must  ever 
form  the  basis  of  all  sound  legislation  upon  this  subject. 
The  precious  metals  do  indeed,  no  doubt,  derive  some  small 
element  of  their  purchasing  power  from  the  fact  that  now 
all  governments  provide  that,  when  coined  in  a  certain  way, 
they  shall  be  a  legal  tender  for  the  payment  of  debts ;  but 
this  element  of  value  is  very  small  and  probably  does  not 
exceed  the  seigniorage  or  charge  for  coinage.  Whatever  it 
may  be,  it  is  so  small  that  there  can  be  no  risk  in  asserting  that, 
were  all  the  legal  tender  laws  of  the  world  repealed  to-day 
and  forever,  neither  gold  nor  silver  would  lose  an  appreci- 
able atom  of  their  power  to  purchase  present  commodities, 
secure  future  contracts,  or  pay  past  debts:  Indeed,  with 
the  example  of  China  before  us,  an  example  which  in  this 
respect  at  least  is  not  without  utility,  it  is  believed  to  be 
more  than  probable  that  their  purchasing  power  would 
increase;  for  setting  aside  the  ettect  of  such  repeal  upon 


^  25 

the  continuance  of  unrepresentative  paper  notes,  it  would 
dissipate  the  very  considerable  fears  that  now  attach  them- 
selves to  every  contract,  wherein  the  words  dollar,  pound, 
or  franc  are  employed  to  express  a  given  weight  of  metal. 

It  has  been  stated  that  with  the  orrowth  of  o-overnmental 
power  came  abuses  in  coinage  and  the  denomination  of 
coins.  These  abuses,  like  all  others,  were  of  gradual 
growth.  The  power  and  authority  of  feudal  lords  and 
monarchs  were  first  employed  in  this  respect  beneficially, 
and  government  was  exercised  within  its  proper  scope, 
Local,  separated,  and  diverse  systems  of  weights  and  meas- 
ures, and  of  the  weights  and  measures  of  gold  and  silver 
pieces,  gave  way  to  national,  united,  and  uniform  systems. 
Isolated  and  anomaloas  measures  of  values,  adopted  in 
small  localities  for  greater  temporary  convenience — as  pieces 
of  iron  in  Africa  and  Sparta  and  of  glass  in  some  parts  of 
Arabia — were  prohibited  by  legal  tender  laws;  for  so  long 
as  thej  were  suffered  to  exist,  they  promoted  provincial 
isolation  and  defeated  national  homogeneity  and  political 
unity.  The  same  laws  also  provided  in  what  substances 
debts  were  to  be  paid  in  cases  unadjadicatable  either  by 
express  stipulation  or  common  usage. 

In  these  early  ages,  while  men  yet  retained  the  power 
to  resist  misgovernment,  the  names  attached  to  pieces  of 
the  precious  metals  were  always  those  of  the  weights  con- 
tained in  such  pieces,  as  the  Jewish  shekel,  of  nearly  one- 
half  of  an  ounce  Troy;  the  Attic  drachma,  of  little  more 
than  one-fourth  of  an  ounce  Troy,  etc. 

To  prevent  counterfeiting*  and  economize  time,  and 
thus  facilitate  exchanges,  these  pieces  of  metal  w^ere  or- 
dered to  be  coined,  and  governments  monopolized,  as 
governments  do  still,  the  function  of  coining.  To  the 
coins  thus  manufactured  were  given  the  names  of  their 
weights,  and  thus  f\ir  the  laws  regulating  the  coinage  of 
the  precious  metals  were  honestly  conceived  and  probably 
as  lionestly  executed. 

With  the  lapse  of  time,  however,  coupled  with  use  of 

*  False  ^old  coins  from  Samos  were  successfully  passed  iu  Sparta  so 
early  as  B.  C.  540.    (Boeekh,  33.) 


26  t 

coins  and  tho  increasing  power  of  authority,  abuses  crept 
into  the  coinage  which  have  lasted  to  this  day.  The 
names  of  coins,  which  at  first  were  literal  weights,  came, 
for  convenience'  sake,  to  be  used  as  symbols  ;  and  men 
no  longer  bargained  for  so  much  gold  or  silver  as  would 
weigh  a  shekel  or  a  drachma,  but  for  so  many  shekels 
or  drachmas  "current  with  the  merchant."  In  this  state 
of  affairs  the  temptation  on  the  part  of  rulers  and  the 
classes  who  environ  power  to  commit  abuses  became  too 
strong  for  resistance. 

Owing  to  the  frequency  of  the  practice  of  degrading  and 
debasing  the  coins,  in  all  countries  and  ages,  the  quantita- 
tive meanino;  attached  to  the  names  of  coins  has  been  so 
often  changed  that,  to  interpret  these  names  or  the  suras 
of  money  mentioned  in  them,  in  ancient  or  medieval  his- 
torical works,  into  modern  weights,  is  almost  an  unsafe 
proceeding,  even  in  the  hands  of  professional  metrolo- 
gists.*  N 

In  order  to  deceptively  reduce  the  pay  of  the  army,  what 
more  easy  method  offered  itself  to  a  ruler  than  that  of 
diminishing  by  decree  and  recoinage  the  weight  of  pure 
metal  in  the  ''drachma."*  In  order,  at  other  times,  to 
exact  greater  fees  or  subsidies,  what  more  easy  expedi- 
ent suEfffested  itself  to  a  feudal  lord  than  to  increase  the 
weight  of  the  "  drachma  ?  "  f  In  cases  where  the  ruler  was 
not  unscrupulous  enough  to  tamper  with  the  coin  for  his 
own  profit,  there  were  never  wanting  powerful  classes 
of  men,  both  ecclesiastical  and  secular,  to  urge  him  to 
similar  practices  for  their  advantage.  Though  instances 
occur  in  history  where  the  standard  was  restored  after  the 
coins  had  been  debased,  the  general  course  of  affairs  was 
ill  the  opposite  direction — a  fact  due  to  the  inability  of  the 
government  to  redeem  the  debased  coin.| 

*Tli(3  "  dollar  "  of  a  few  grains  weitjht  was  formorly  the  "thaler"  of 
more  than  an  ounce,  ami  anciently  the  "talent"  of  many  pounds. 

t  See  instance  of  Lord  King's  exaction  of  his  tenants'  rents  in  gold  during 
the  bank  suspension.     (MacLeod's  Dictionary  Polit.  Econ.,  i,  98.) 

J  The  gold  scriptulum  was  debased  in  Eorae  so  early  as  B.  C.  207. 
Bceckh,  44.) 


27 

I  do  not  propose  at  this  time  to  enter  any  further  into  the 
history  of  these  events;  ray  ohject  thus  far  having  heen 
merely  to  show  that  money,  in  the  early  ages,  whatever  it 
was  made  of,  came  into  use  voluntarily;  was  alwaj's  com- 
posed of  substances  of  supposed  adequate  and  steady  sup- 
ply; owed  none  of  its  utility  to  legal-tender  laws,  which  were 
originally  enacted  for  other  and  more  practicable  purposes; 
and,  up  to  the  period  of  the  dark  ages  in  Europe,  had  con- 
sisted for  at  least  three  thousand  years  of  gold  and  silver 
coins  only. 

We  have  now  to  consider  three  other  points  in  this  con- 
nection :  the  World's  supply  and  consumption  of  the  precious 
metals,  the  effects  of  an  inadequate  or  monopolized  sup- 
ply, and  the  necessity  of  adhering  to  both  of  the  precious 
metals  for  the  basis  of  a  national  currency,  whether  the 
same  shall  consist  wholly  of  the  precious  metals  or  partly 
of  convertible  paper  credits,  or  representative  money. 

HISTORY   OF   THE    SUPPLY  AND    CONSUMPTION  OF  THE   PRECIOUS 

METALS  IN  EUROPE. 

The  repeated  destructions  of  historical  works  previous  to 
the  invention  of  paper,  and  the  subsequent  one  of  printing, 
have  left  us  but  little  exact  information  on  this  subject. 
We  onl}'  know  generally  that  previous  to  the  Macedonian 
Empire  both  of  the  precious  metals  were  comparatively 
common  in  farther  Asia*  and  scarce  in  Europe.  This 
much  we  gather  from  the  sizes  of  the  pieces  that  were  coined 
and  used  for  circulating  money  in  the  respective  regions, 


*  There  is  an  instance  in  Sfrabo's  IGtli  book  of  an  eastern  countr.v, 
(possibl}-  India,)  borderini^  on  that  of  the  Sabaens,  (Arabia?)  where  gold 
to  silver  was  otdj^  1  for  2,  and  to  bronze  only  1  for  3.  Witli  the  in- 
stance before  ns  of  modern  Japan,  where  gold  (purity  not  stated)  was 
quoted  in  1853  at  1  to  4  of  silver,  it  maj'  seem  bold  to  challenge  this 
assertion,  hnt  otiier  instances  in  regartl  to  Ciiina  assure  us  tliat  Oriental 
quotations  are  unreliable,  from  tli(^  fact  that  iu  tiie  early  ages  gold  and 
silver  ingots,  impure  and  largely  burdened  with  base  substances,  circu- 
lated as  money,  and  tlie  quoted  relation  referred  to  the  value  of  these 
impure  ingots,  and  not  to  tlie  value  of  tlie  pure  metals.     Consult  a  pam- 


28 

the  prices  of  commodities  and  services,  the  enumeration  of 
rojal  and  princely  treasures,  and  the  employment  of  the 
precious  metals  in  the  arts.  The  relation  of  gold  to  silver 
in  ancient  and  farther  Asia  has  not  been  determined. 

At  a  later  period,  about  B.  C.  500,  we  hear  of  it  in 
Persia,  at  1  to  13.  After  this  period  and  on  this  point  the 
annals  of  the  Orient  were  closed  for  many  centuries.  At 
about  the  same  period  the  relation  of  gold  to  silver  in 
Europe  was  about  1  to  12.5.  From  this  relation  gold  rose 
to  1  to  13|  and  even  15,  until  the  time  of  expeditions  of 
Alexander  the  Great.  These,  through  the  influence  of  the 
vast  treasures  in  gold  of  which  they  despoiled  the  eastern 
countries,  brought  gold  down  again  to  1  to  10,  at  which 
rate  it  stood  in  the  time  of  the  comic  poet  Menander, 
about  B.  C.  300.  That  it  was  the  fluctuations  in  the  sup- 
ply of  gold,  and  not  those  of  silver,  which  occasioned  the 
most  of  these  changes  of  relation,  we  are  assured,  from 
the  sporadic  influxes  of  gold  alluded  to,  and  from  Xeno- 
phon's  encomium  on  silver,  written  about  B.  C.  383;  while 
Boeckh  himself,  in  his  work  on  The  Public  Economy  of  the 
Athenians,  from  which  these  details  are  gleaned,  says,  gen- 
erally, that  "the  value  of  gold  is  more  fluctuating  than 
that  of  silver,"  and  that  "the  latter,  therefore,  may  be 
considered  the  scale  for  determining  the  price  of  gold,  as 
well  as  of  other  commodities."* 

After  the  Macedonian  conquests  the  stock  of  the  precious 
metals  in  Europe  increased  very  rapidly  until  at  about  the 
beginning  of  our  era,  when,  according  to  the  estimate  of 
Mr.  Wm.  Jacob,  it  amounted,  throughout  the  Roman  em- 


plilet  by  "A  Disciple  of  Franklin,"  in  American  Philosophical  Society 
library,  Philadelphia,  No.  6332,  page  9,  where  it  is  stated  tlnit  Chinese 
g-old  from  Sumatra,  Celebes,  &c.,  was  but  IG  to  18  carats  fine,  and  that 
the  relation  in  Ciiina  in  about  the  year  ISIO  was  1  in  gold,  as  thus 
found,  to  12  in  (pure)  silver.  At  least  we  can  feel  fully  assured  that  tlie 
i-elations  mentioned  by  Strabo  were  local,  and  only  referred  to  tlie  par- 
ticular locality  indicated.  Consult  Boeckh,  p.  43.  Anotiier  anomalous 
and  still  more  (ixtraordiuary  thougli  possibly  not  unauthentic  instance  of 
the  kind  is  related  in  .Jacob's  History  Precious  Metals,  p.  .57. 
*  Boeckh,  33. 


29 

pire,  to  a  quantity  equal  in  value  to  about  $1,740,000,000 
of  the  present  time.  The  relative  proportions  of  gold  and 
silver  are  not  calculated.  The  relation  of  value  between 
the  metals  in  the  Roman  empire  was,  about  B.  C.  207,  1 
to  1-3.7,  and  about  B.  C,  50  or  64  years  before  the  period 
of  Jacob's  estimate,  1  to  11.9. 

From  about  the  beginning  of  the  Christian  era  to  the 
present  time  the  history  of  the  precious  metals  has  been 
traced  very  closely,  and  with  great  labor  and  acumen,  by 
three  great  historians :  Wm.  Jacob,  whose  work  covers 
the  entire  period  from  the  year  14  to  the  year  1830;  Baron 
Von  Humboldt,  whose  work  covers  the  period  from  the 
discovery  of  America  until  the  early  part  of  the  present 
century;  and  Michel  Chevalier,  whose  work  brings  the 
history  up  to  within  twenty  years  of  the  present  time. 

The  salient  points  of  this  long  though  extremely  inter- 
esting history  are  : 

1.  The  separation  of  the  Asian  and  European  histories 
of  money,  from  the  downfoU  of  the  Roman  military  power 
until  the  Eastern  trade  was  reopened  in  part  by  the  medi- 
eval Italians  and  Arabians,  and  wholly  by  the  Portuguese 
navigators;  and,  2.  The  failure  of  the  European  mines 
previous  to  the  downfall  of  Rome  and  the  gradual  decline 
of  the  stock  of  precious  metals  thenceforward  until  the 
ninth  century;  its  stationary  condition  until  the  discovery 
of  America;  its  rapid  increase  thereafter,  until  about  the 
beginning  of  the  present  century ;  its  subsequenttemporary 
decline  from  the  year  1809  to  1830;  its  slow  increase  there- 
after; its  rapid  increase  from  the  time  when  the  effects  of 
the  opening  of  the  Russian,  American,  and  Australian 
mines  were  felt,  until  within  late  years;  and  its  stationary 
condition  at  the  present  time. 

Omitting  from  further  mention  all  that  is  not  necessary 
for  the  purposes  of  this  review,  let  us  briefly  follow  Mr. 
Jacob's  history  of  the  precious  metals  from  the  beginning 
of  the  Christian  era. 

From  the  enormous  wealth  of  individuals,  the  high  prices 
of  commodities  and  services,  the  vast  revenues  of  the  State, 


30 

and  other  circumstances,  Mr.  Jacob  conjectured  that,  in 
the  time  of  Augustus  Ceesar,  the  quantity  of  money  in 
existence  in  ancient  Rome,  which  then  substantially  com- 
prised the  whole  civilized  world,  was  £358,000,000,  or 
about  $1,740,000,000  The  correctness  of  this  sum  is 
deemed  to  be  rendered  the  more  probable  from  the  fact 
that  Vespasian,  when  afterward  he  succeeded  to  the  im- 
perial dignity,  asserted  that  a  sum  equivalent  to  £322,916,600 
was  necessary  to  support  the  commonwealth — meaning, 
not  the  government,  for  neither  the  annual  revenue  nor  the 
accumulation  of  the  treasury,  bore  any  proximate  relation 
to  this  vast  sum — but  the  nation  at  large.  It  is  believed 
that  he  mentioned  a  sum  which  coincided,  as  far  as  is 
known,  with  the  whole  mass  of  coined  money  then  believed 
to  exist,  and  upon  this  supposition,  and  the  inferences  to 
which  it  leads,  historical  writers  have  hitherto  been  content 
to  rest. 

A  few  instances  of  the  abundance  of  money  at  that 
period  may  not  be  out  of  place.  Crassus  possessed  in  lands 
bis  millies  (£1,615,000,)  besides  many  slaves  and  furniture 
valued  at  much  more.  Seneca  possessed  ter  millies  (£2,420,- 
000;)  Pallas  an  equal  sum;  Lentulus  quatcr  millies  (£8,- 
230,0C0;)  Augustus  Cresar  obtained  from  private  legacies 
quaier  dccies  millies  (£32,300,000,)  and  Tiberius  left  at  his 
death  vigesies  acse-pties  millies  (£21,800,000,)  which  Caligula 
lavished  away  in  a  single  year.  Ctesar  when  he  went  to 
Spain  was  in  debt  £2,018,000,  and  Anthony  squandered  of 
the  public  money  more  than  £5,600,000  sterling. 

These  facts  were  compiled  by  Jacob  chiefly  from  Adams's 
Roman  Antiquities,  while  the  sterling  sums  were  com- 
puted by  Arbuthnot.  I  prefer  to  retain  them  as  originally 
computed. 

Augustus  frequently  gave  con^^i'arM,  ranging  from  45.  \0d. 
to  £2  2s  Id.  per  head  to  the  whole  population,  men,  women, 
and  children;  and,  at  his  death,  left  all  the  common  men 
£2  8s.  5<:/.  each.  In  this  prodigious  liberality  he  was  even 
exceeded  by  several  other  emperors,  but  the  instances  de- 
mand too  much  space.     Milo  gave  each  voter  a  bribe  of 


31 

£32  85,  lOd.  Claudius  promised  each  soldier  for  his  vote 
£113,  and  Julian  £210  16.?.  Otho  promised  to  the  attainers 
of  Galba  a  reward  of  £403  12.s.  each,  and  paid  them  £80 
14s.  in  advance,  etc.,  etc. 

In  the  time  of  Augustas  the  gold  and  silver  mines  which 
had  kept  good  Rome's  supply  of  treasure  gave  out  and 
ceased  to  be  worked.  Moreover,  there  was  no  more  spoil 
of  the  precious  metals  to  be  obtained  in  Asia  or  Northern 
Europe. 

This  was  due  to  the  exhaustion  of  those  conquered  coun- 
tries, to  the  unsettled  condition  of  the  empire,  to  wars, 
the  incursions  of  barbarians,  the  insufficiency  of  mechan- 
ical resources,  the  loss  of  life  and  hardships  of  the  slaves 
employed  in  the  mines,  which  induced  them  to  desert 
their  occupation  whenever  civil  commotion  afforded  them 
a  convenient  opportunity,  and  to  other  causes  set  forth  by 
our  author.* 

From  that  time,  therefore,  the  stock  of  money  decreased, 
and  it  has  been  calculated  that  the  decrement  proceeded  at 
the  following  rate : 

Year  of  the  Stock  of  coin  in  Year  of  the  Stock  of  coin  in 

Christian  era.  civilized  world.  Christian  era.         civilized  world. 

14 £358,000,000  446 £96,692,332 

50 322,200,000  482 87,033,099 

86 287,980,000  518 78,229,700 

122 259,182,00J  554 70,406,720 

158 233,263,800  590 63,364,057 

194 209,937,420  626 57,027,653 

230 181,943,678  662 51,324,889 

266 —163,749,311  698 46,192,399 

302 147,374.380  734 41,573,160 

338 132,636,942  770 37,415,840 

374 119,373,248  806 33,674,256 

410 107,435,924 

A  calculation  so  hypothetical  as  this  must  not,  of  course, 
be  taken  too  literally.  It  is  sufficient  if  its  general  cor- 
rectness is  supported  by  all  the  facts  we  know,  and  this 


*  An  ancient  law  of  the  Roman  senate  actuallj'-  forbade  the  Italian 
mines  to  be  worked  at  all.     Plinj>  book  iii,  ch.  6,  quoted  in  Jacob,  51. 


32 

seems  to  be  the  case.  The  gradually  deepening  misery  of 
the  populations  of  Europe  during  the  meflieval  ages,  the 
deca}'  of  the  civil  law,  the  demoralization  of  society,  the 
disintegration  of  government  and  authority,  the  insti- 
tution (probably  reinstitution)  of  feudalism,  the  poverty, 
filth,  pestilences,  abominable  crimes,  ignorance,  and  wretch- 
edness, that  characterized  this  period  of  history  and  gave 
to  it  its  well  deserved  name  of  the  Dark  Asres — these  facts 
are  too  well  known  to  need  repeating.  That  such  a  con- 
dition of  affairs  was  promoted  solely  by  means  of  a  gradual 
and  constant  diminution  of  the  currency  is  not  contended; 
though  it  would  not  be  difBcult  to  arirue  the  result  from 
the  predicate.  But  that  the  diminution  of  the  currency 
largely  contributed  to  bring  it  about  and  maintain  it,  may 
be  affirmed  with  entire  confidence;  and  the  careful  thinker 
will  find  it  difficult  to  discern  a  cause  that  will  more  satis- 
factorily account  for  that  extraordinary  breaking  up  of 
governments  and  arrest  of  social  development  and  of  the 
growth  of  population  which  occurred  in  Europe  from  about 
the  beginning  of  the  present  era  to  the  time  of  the  discov- 
ery of  America. 

From  the  age  of  Augustus  Csesar  to  that  of  Charlemagne 
and  the  Saxon  Heptarchy  is  like  going  from  the  mouth  to 
the  bottom  of  the  ancient  mines — abov'e,  all  lightness,  hap- 
piness, and  life;  below,  all  darkness,  misery,  and  death. 

These  were  the  ages  of  alchemists  and  false  coiners. 
They  both  sought  to  obtain  gold  from  base  metals;  the 
first  by  transmutation,  the  other  by  arrant  roguerj'.  The 
base  pieces  they  produced  were  known  by  the  names  of 
pollards,  crocards,  schuldings,  brabants,  eagles,  leonines, 
sleepings,  &c.  Those  who  were  pitched  upon  as  the  fabric- 
ators of  these  pieces  were  visited  with  fearful  punishment. 
Racking,  pressing  to  death,  burning,  drowning,  and  tramp- 
ing were  common  enough.  Whole  families  were  exported, 
whole  communities  robbed  and  banished  under  the  pre- 
tense of  punishing  coiners. 

Such  was  the  scarcity  of  the  precious  metals  that  living 
money  was  used  instead.     This  consisted  of  men  and  women, 


33 

who  were  thus  passed  from  hand  to  hand  as  a  legal  tender.* 
The  poverty  and  degradation  of  the  people  were  inconceiv- 
able. The  price  of  a  hawk  was  the  same  as  that  of  a  man, 
and  robbing  the  nest  of  one  was  as  great  a  crime  as  depriv- 
ing of  life  the  other.f  Famine  and  pestilence,  superstition 
and  tyranny,  terror  and  outrage,  reigned  supreme. 

These  were  the  Dark  Ages;  and  so  profound  were  the 
depths  into  which  they  cast  humanity  that  nearly  a  thou- 
sand years  later  Arthur  Young  thus  quoted  from  the 
cahiers  of  the  "tiers  etat"  of  that  feudal  system  to  which 
the  Middle  Ages  had  given  birth: 

"Fixed  and  heavy  rents;  vexatious  processes  to  secure 
them;  appreciated  unjustly  to  augment  them;  rents  soU- 
daires  and  reveulbables ;  rents,  cheantes,  and  levantes;  fuma- 
ges.  Fines  at  every  change  of  the  property,  in  the  direct 
as  well  as  collateral  line ;  feudal  redemption  {retraite)  fines 
on  sale  to  the  eighth  and  even  the  sixth  penny  (part;)  re- 
demptions (rachats)  injurious  in  their  origin,  and  still  more 
so  in  their  extension;  banalite  of  the  mill,  of  the  oven,  afid 
of  the  cider-press ;  corvees  by  custom ;  corvees  by  usage  of 
the  fief;  corvees  established  by  unjust  decrees;  corvees  ar- 
bitrary and  even  fantastical;  servitudes;  lorestatioiis,  Qxtv&v- 
agant  and  burthensome;  collections  by  assessments  incol- 
lectible;  aveux,  minus^  imj)umssement ;  litigations,  ruinous 
and  without  end;  the  rod  of  seigneural  finance  forever 
sliaken  over  our  heads;  vexation,  ruin,  outrage,  violence, 
and  distinctive  servitude,  under  which  the  peasants,  almost 
on  a  level  with  Polish  slaves,  can  never  but  be  miserable, 
vile,  and  oppressed." 

Even  the  liberty  to  bruise  between  two  stones  a  measure 
of  barley  was  sold  to  these  miserable  creatures,  while  the 
names  of  the  tortures  to  which  they  were  subjected  are 
eloquent  in  their  very  jargon  and  variety. 

In  order  to  preserve  the  game,  in  the  pursuit  of  which 
the  nobles  trampled  down  the  wretched  crops  and  rode 
over  the  very  bodies  of  the  poor,  there  were  numerous 
edicts,  which  prohibited  weeding  and  hoeing,  lest  the 
young  partridges  should  be  disturbed;  steeping  seed,  lest 


*  Henry's  Hist,  of  Great  Britain,    t  J^i-cob  on  Precious  Metals,  p.  170. 
3 


34 

it  should  injure  the  game;  manuring  with  night  soil,  lest 
the  flavor  of  the  partridges  should  be  injured  by  feeding 
on  the  corn  produced,  &c. 

Recollect  that  this  was  nearly  a  thousand  years  later  than 
the  period  from  which  we  have  digressed,  when,  instead  of 
tending  downward,  as  it  did  until  the  middle  of  the  twelfth 
century,  society,  under  the  combined  influences  of  an  in- 
creasing stock  of  coin,  an  increasing  diffasion  of  wealth, 
and  increasing  industrial  activity,  was  rapidly  progressing 
towards  liberty  and  afliuence.  Consider,  then,  what  must 
have  been  the  condition  of  affairs  in  the  year  806;  a  period 
so  unspeakabl}^  wretched  that  we  have  not  even  a  contem- 
porary account  of  its  wretchedness! 

Gold  was  nowhere  to  be  had,  and  the  few  gold  pieces  in 
circulation  were  of  an  ancient  Byzantine*  coinage;  whilst 
silver  was  so  scarce,  that,  together  with  gold,  it  was  at  a  sub- 
sequent period  forbidden  by  an  act  of  Henry  V  to  be  used 
in  the  arts.f 

These  instances  could  be  multiplied  almost  indefinitely, 
but  it  is  not  necessary.  It  is  sufficient  if  they  attest  the 
poverty,  wretchedness  and  tyranny  that  attends  a  decline  in 
the  quantity  of  money  or  of  the  only  bases  upon  which 
any  system  of  money,  representative  or  partly  representa- 
tive, can  stand — the  precious  metals. 

I  am  aware  that  the  reply  to  this  implication  may  be 
that  it  makes  no  difference  how  much  the  stock  of  coin  is, 
if  its  only  function  is  to  measure  value  which  is  merely  a 
relation.  This  position  T  admit  to  be  well  taken  if  the  stock 
of  money  remains  forever  stationary,  or,  rather  stationary 
per  capita  of  population.  In  such  case  a  grain  of  silver 
will  measurequite  as  effectually  the  relation  between  a  day's 
work  and  its  equivalent  in  commodities,  as  a  pound  of  sil- 
ver will,  with  a  stock  of  coin  5,760  times  as  great,  and  if 
money  was  already  not  concentrated  in  a  few  hands  and 
there  were  no  debts.  The  only  limitation  to  the  perfect 
equality  of  these  two  conditions  of  affairs  would  be  that 


♦Jacob,  169.  ]Ibid.,  1G7. 


35 

in  the  one  case  coins  might  have  to  be  made  too  small  for 
convenient  handling,  or  in  the  other  too  large. 

But  in  point  of  fact  there  is  not  and  never  can  be  a  con- 
tinuously stationary  amount  of  money  in  existence  or 
even  a  stationary  amount  per  capita.  Money,  as  related 
to  population,  has  a  natural  tendency  to  increase  in  quan- 
tity, because  increase  of  money  quickens  industrj^  and 
distributes  wealth.  Opposed  to  this  tendenc}'  are  wars, 
the  failure  of  mines,  the  abrasion  and  loss  of  the  pre- 
cious metals,  the  insufficiency  of  mechanical  resources,  and 
the  influence  of  wealthy  classes.  We  have  seen  to  what 
an  appalling  strait  the  first  three  of  these  causes  brought,  or 
assisted  to  bring,  the  European  world — a  strait  in  which  it 
remained  for  nine  hundred  years;  until  it  was  freed  by 
the  discovery  of  the  mines  of  Potosi.  W"e  shall  yet  see 
how  the  fourth  cause  operated  at  about  the  beginning  of 
this  century,  and  how  the  fifth  cause  is  operating  now. 

These  opposing  tendencies,  operating  with  varying  force, 
alternately  diminish  and  increase  the  stock  of  precious  met- 
als and  place  the  subject  quite  beyond  the  category  of  fixed 
things.  There  is  nothing  fixed  about  it,  and  legislation 
must  deal  with  it  with  all  its  eyes  and  ears  opened.  Left  to 
itself  and  the  industry  and  self-seeking  of  mankind,  money 
would  increase  as  all  other  commodities  increase,  and 
society  would  rapidly  undergo  that  equalization  of  wealth 
which  the  vagaries  of  fortune  would  stamp  with  equity; 
but  reduced  to  an  unwilling  wardship  by  monarchs  and 
legislatures,  dragged  hither  and  thither  at  the  nod  of  plu- 
tocrats, legal-tendered,  single-standarded,  royaltied,  taxed, 
and  bedeviled  in  every  imaginable  manner,  it  has  been  re- 
strained and  dwarfed  in  its  increase,  and  made  to  become 
the  instrument  of  half  the  misrule  and  misery  which  the 
world  has  undergone. 

Though  there  was  no  increase  in  the  European  world's 
stock  of  coin  from  the  beorinnino;  of  the  ninth  centurv 
until  the  discovery  of  America,  nevertheless  there  was  no 
diminution.  This  arrest  in  the  shrinkage  of  money  is  due 
to  the  invention,  or,  more  probably,  the  reinvention  of  Bills 


36 

of  Exchange,  which  served  to  quicken  money  and  enable 
a  limited  stock  to  perform  tlie  work  of  a  large  one. 

The  bill  of  exchange  was  unknown  to  the  ancient  Greeks 
and  Romans.  They  were  even  without  the  use  of  paper 
upon  which  to  inscribe  these  instruments.  Obligations  of 
debt  even  so  late  as  the  time  of  the  Roman  Empire  having 
been  inscribed  upon  tablets  of  wax;  the  limited  supply  of 
parchment  being  reserved  for  the  higher  purposes  of  liter- 
ature. Paper  was  made  in  China  so  early  as  the  second 
century  before  Christ,  at  about  which  time  papyrus  was 
invented  in  Egypt  and  parchment  in  Europe. 

It  is  difficult  to  conceive  of  a  great  commercial  nation — 
and  there  certainly  was  such  an  one  at  the  time  men- 
tioned— having  the  use  of  paper  and  ignorant  of  the  device 
known  as  bills  of  exchans-e.  Be  this  as  it  mav,  an  instru- 
ment  known  as  the  hoondee,  and  corresponding  precisely 
with  the  modern  bill  of  exchange,  was  known  in  India  at 
a  very  early  date;  and  the  Hebrews,  always  a  trading  race, 
who  were  among  the  first  to  trade  with  India,  "  by  Tadmor 
in  the  desert,"  very  likely  learned  its  use  from  that  country. 

These  historical  conjectures  are,  however,  of  little  prac- 
tical value  in  this  connection.  The  material  point  is,  that 
no  sooner  was  paper  invented  or  introduced  into  Europe, 
and  possibly  a  little  before,*  than  bills  of  exchange  came 
into  use,  and  that  these  events  correspond  with  the  time  ot 
lowest  diminution  in  the  stock  of  coin  in  Europe. 

It  has  been  suggested  by  some  writers  that  the  inven- 
tion or  introduction  into  Europe  of  the  bill  of  exchange  is 
due  less  to  the  ingenuity  of  the  Jews  or  the  art  of  making 
paper  than  to  that  improvement  in  social  organizations 
and  extension  of  political  authority  which  distinguished 
the  Italian  republics  of  the  medieval  ages.  To  this  sug- 
gestion it  need  only  be  repeated  that  bills  of  exchange  were 
unknown  to  the  Greek  and  Roman  civilizations,  and  that. 


*Some  authors  (c.  g.  Putnam's  Cj'clopedia)  date  the  bill  of  exchange  in 
Europe  as  far  baclv  as  the  j'ear  808;  others  (e.  g.  Anderson  in  his  Hist. 
Com.)  date  it,  with  greater  probability,  in  A.  D.  1160. 


37 

long  after  they  came  into  use,  their  use  was  confined  to  the 
Jews^  who,  whatever  may  have  been  their  confidence  in 
medieval  society,  and  medieval  justice  and  political  secu- 
rity, took  great  care  never  to  trust  to  them,  and  traded 
chiefly  with  each  other. 

Following  the  introduction  of  bills  of  exchange  came 
the  establishment  of  those  great  Fairs,  which  for  ages  per- 
formed the  functions  of  so  many  clearing-houses  for  the 
inland  commerce  of  Europe;  and  next  the  establishment 
of  banks  in  Italy,  Spain,  and  Holland.  The  first  fair  dates 
from  the  year  886;  the  first  bank,  from  which,  however, 
no  circulating  notes  were  issued,  was  that  of  Venice,  in 
1167.  These  dates  are  oases  in  a  desert  of  wretchedness 
and  gloom. 

But  by  far  the  most  important  of  the  several  methods  of 
relief  which  society  so  eagerly  sought  in  this  long  era  of 
money  dearth  was  that  adopted  in  Milan  A.  D.  1240,  this 
being  the  year  in  which,  according  to  Arthur  Young,* 
paper  circulating  notes  were  first  used  in  Europe.  From 
the  fact  that  at  about  the  same  time,  or  within  a  few  years 
afterward,  paper  notes  of  the  same  character  were  em- 
ployed in  China, t  there  is  some  ground  for  the  belief  that 
the  dearth  of  money  in  Europe  was  felt  also  in  that  distant 
and  almost  unconnected  part  of  the  world.  In  both  these 
instances  the  notes  used  were  issued  by  Government,  and 
made  a  legal  tender  for  the  payment  of  debts. 

Severe  bullionists  may  scott*  at  this,  at  the  debasement 
of  coins,  and  at  the  many  other  financial  dishonesties  and 
enormities,  as  they  are  pleased  to  call  them,  of  the  Dark 
Ages;  but  let  me  tell  them,  who  am  also  a  bullionist,  in 
so  far  that  I  recognize  the  superior  economy,  stability,  and 
justice  of  a  money  system  consisting  of,  or  at  least  based 
representatively,  wholly  or  in  part,  upon,  the  precious 
metals,  that  society  could  not  have  been  preserved  without 
these  measures.  Mankind  had  paid  dearly  enough  in  nine 
long  centuries  of  tyranny,  anarchy,  and  slavery  for  the 


*  Travels,  2,  173.  f  Marco  Polo. 


38 

boon  of  a  common  medium  of  exchange.  To  have  paid 
an}^  more  for  it  would  have  been  to  pay  with  life  itself,  for 
that,  which,  at  the  best,  could  only  economize  its  labor  and 
alleviate  its  burdens. 

These  fiscal  measures  not  only  eked  out  the  scanty  and 
stationary  stock  of  coin  which  existed  at  that  period  ;  they 
economized  its  use,  saved  it  from  abrasion  and  loss,  added 
to  the  rapidity  of  its  circulation,  made  it  perform  double 
work,  and  thus  bridged  over  the  five  hundred  years  of 
further  dearth  of  money  which  was  to  continue  until  the 
discovery  of  America. 

It  is  hardly  worth  while  to  specifically  trace  the  wonder- 
ful and  beneficial  eflects  of  the  relief  thus  obtained  or  the 
era  of  industrial  activity,  commercial  enterprise,  and  poli- 
tical enfranchisement  to  which  it  contributed,  and  which 
it  is  quite  safe  to  say  could  not  have  occurred  without  it. 
The  financial  history  of  the  past  three  hundred  years  is 
sufiiclently  familiar  to  every  one,  and  all  that  is  necessary 
in  this  place  is  to  insert  Mr.  Jacob's  hypothetical  table  of 
the  increasing  stock  of  the  precious  metals  following  the 
Dark  Ages  : 
Year,  A.  D.  Stock  of  Coin. 

1066 £34,600,000 

1500 34,000,000 

1,546 49,400,000 

1600 126,600,000 

The  ancient  mode  of  obtaining  the  precious  metals  has 
been  described.  It  consisted  of  washing  auriferous  sands 
and  picking  with  rude  instruments  such  scanty  deposits  of 
pure  metal  as  could  be  found.  With  the  invention  of 
bronze  tools  and  of  smelting  furnaces,  a  great  impetus  was 
aiibrded  to  mining,  and  this  was  increased  by  the  invention 
of  iron  tools.  It  was  in  this  condition  that  the  art  stood 
at  the  Roman  era,  the  use  of  mercury  in  quickening  and 
perfecting  the  process  of  recovering  the  precious  metals 
not  having  been  acquired  until  after  the  discovery  of 
America.  The  16th  and  17th  centuries  therefore  gave  to 
the  European  world  three  great  sources  of  increase  to  its 


39 

stock  of  the  precious  metals  :  1.  The  stock  despoiled  of  the 
"West  India  Islanders,  the  Mexicans  and  the  Peruvians.  2. 
The  new  and  great  mines  of  Central  America  and  Peru. 
3d.  The  use  of  mercury  in  the  amalgamation  of  ores. 

Notwithstanding  all  these  new  and  additional  sources  of 
supply,  so  utter  had  been  the  exhaustion  of  the  European 
world's  stock  of  gold  and  silver,  so  eager  was  the  demand 
for  these  metals,  so  rapidly  were  tliey  absorbed  in  the  arts, 
in  the  Asiatic  trade,*  and  by  abrasion  and  loss,  that  the 
world's  supply  again  came  to  a  stand-still  shortly  after  the 
beginning  of  the  present  century.  The  following  are  Mr. 
Jacob's  hypothetical  figures,  which,  for  the  period  toward 
which  we  are  now  approaching,  must  be  regarded  as  cor- 
roborated by  the  various  careful  computations  of  Humboldt 
and  other  authors.  The  reduction  to  dollars  is  at  the  rate 
of  five  to  the  pound  sterling: 

Year  A.  D.  Stock  of  coin  Authority. 

in  the  commercial  world. 

1700 $1,445,000,000  Jacob. 

1700 1,318,000,000  Tooke. 

1809 1.687,000,000  Gerboux. 

1809 1,849,000,000  Tooke. 

1827 1,720,000,000  Humboldt. 

1829 1,557,000,000  Jacob. 

1830 1,600,000,000  Storch. 

1839 1,420,000,000  Storch. 

The  social  phenomena  of  this  period  are  too  widespread 
and  too  directly  traceable  to  monetary  disturbances  to  ad- 
mit of  much  doubt  as  to  their  connection  with  the  decline 
in  the  world's  stock  of  coin.  To  say  nothing  of  the  French 
revolution  and  the  wars  and  great  political  events  to  which 
it  gave  rise — all  of  which,  if  they  did  not  spring  from,  were 
certainly  precipitated  by,  the  unendurable  poverty  and  suf- 

*  Humboldt's  statement  on  this  subject  would  lead  to  the  inference 
that  Asia  had  taken  two-thirds  of  the  entire  American  supply.  For- 
bonnais  supposes  that  between  1492  and  1724  Asia  took  one-half  of  the 
American  supply,  and  Gerboux's  estimate  even  exceeds  this.  Mr. 
Jacob,  who  reviewed  them  all,  settled  down  to  the  opinion  that  Asia 
took  two-fiflhs  of  the  American  supply  between  1700  and  ISIO.  (Jacob, 
p.  307.) 


40 

ferings  of  the  French  peasantry,  which  culminated  in  riots 
for  bread  and  the  distribution  of  wealth — this  period  is 
characterized  by  disorders  all  over  Europe.  The  New- 
castle and  Scotch  banks  in  Great  Britain  suspended  in 
1793,  the  Bank  of  St.  Petersburgh  suspended  in  1796,  the 
Bank  of  England  in  1797,  and  again  in  1822.*  It  was  dur- 
ing this  period  that  arose  the  State  and  provincial  banking 
systems  of  this  country  and  Great  Britain,  through  which 
the  actual  and  threatened  dearth  of  money  was  alleviated 
by  means  of  circulating  notes  representing  but  a  small  basis 
of  specie.  These  desperate  and  unsafe  expedients  always 
evince  a  scarcity  of  the  precious  metals.  It  was  during 
this  period  that  these  systems  failed  over  and  over  again, 
not,  however,  without  answering  for  precious  intervals  of 
time  the  important  purpose  of  their  establishment.  The 
State  banks  of  the  United  States  failed  in  1816,  1819,  and 
1827,  and  signally  in  1837.  The  provincial  banks  of  Eng- 
land in  1826  and  1847.  Specie  payments  were  suspended 
in  France  in  1790,  and  an  enormous  issue  of  assiguats  and 
mandats  followed.  As  for  the  American  suspension  of 
1837  it  was  felt  all  over  the  commercial  world,  which  it 
shook  to  its  foundations. 

What  had  happened?  Some  people  say  wars;  others, 
over-speculation.  Perhaps  they  are  right.  Causation  is 
a  difficult  science.  But  certainly  the  well  attested  de- 
crease in  the  stock  of  the  precious  metals  which  occurred  at 
about  the  beginning  of  the  century  may  have  had,  and,  in 
my  opinion  did  have,  much  to  do  with  these  events.  In 
flict,  as  Mr.  Patterson  has  shown  in  his  "  Economy  of  Cap- 
ital," they  were  in  every  case  preceeded  by  an  export  and 
local  scarcity  of  specie. 

Be  this  as  it  may,  two  new  sources  of  relief  were  hasten- 
ing to  the  assistance  of  society.  1.  The  adaptation  of 
steam  to  the  processes  of  mining;  2.  The  discovery  or 
rather  rediscovery  of  the  Ural  mines,  and  the  subsequent 
^nd  more  important  opening  of  California  and  Australia. 
The  new  mines  were  discovered  first.     The  adaptation  of 

*Aii  abortive  imciiipf  lo  resume  specie  payments  was  made  in  1817. 
(MeLeod'.-*  Diet,  rolit.  Ecou.,  1,  99.) 


41 

steam  to  their  development  came  much  later — indeed,  be- 
longs to  the  past  few  years. 

The  following  are  the  statistics  of  the  amount  of  specie 
added  to  the  stock  of  the  commercial  world  from  1848 
to  1865  : 

Stock  of  specie  in  the 
Year  A.  D.  commercial  world.  Authority. 

1848-'53 S2,500,000,000 McCuUoch. 

1857-'60 2,800,000,000 Ru^gles. 

1872  - —  3,600,000,000  Ernest  Seyd. 

The  following  are  the  estimates  of  various  authorities 
of  the  stock  of  gold  coin  (onlj')  in  the  commercial  or  Occi- 
dental world  since  1848  : 

Stock  of  gold  coin  in  the 
Year  A.  D.  commercial  world.  Authority. 

1848 11,200,000,000 Chevalier. 

1848 1,332,000,000 Est.  on  J^ewmarch. 

1848 1,090,000,000 Est.  on  Levasseur. 

1849 1,306,000,000 Jacob. 

1853 1,464,000,000 Est.  on  Waguelin. 

1860 1,998,000,000 Est.  on  ITewmarch. 

1860 2,209,000,000 Est.  on  Is^ewmarch. 

1867 2,600,000,000 Euggles. 

1872 2,600,000,000 Ernest  Seyd. 

With  this  vast  and  refreshing  increment  of  specie,  which 
more  than  filled  the  void  left  by  the  failure  of  the  superfi- 
cially-worked mines  of  Mexico  and  South  America  at  the 
close  of  the  last  century,  a  new  era  of  industrial  activity, 
progress  and  development  awaited  society;  an  era  which,  if 
entered  upon  without  reserve,  might  have  crowded  ten 
years  into  one,  advanced  us  a  century  beyond  the  present 
time,  and  conferred  upon  each  individual  of  to-day,  the  prac- 
tical benefits  of  longevity. 

But  it  was  not  entered  upon  without  reserve.  Tiie  plu- 
tocrats of  Europe  took  alarm  at  the  rapid  increase  of  specie. 
They  could  manage  to  dispose  of  the  surface-washings  of 
go\d  in  California  and  Australia,  but  they  feared  the  appli- 
cation of  steam  machinery  to  the  quarts;  veins  of  the  Sierra 


42 

Nevadas,  and  they  put  their  long  heads  together  and  con- 
spired to  clieat  labor  and  enterprise  of  their  reward  and 
mankind  of  the  main  element  of  its  cireulatine:  media. 
This  was  effected  bj  the  Demonetization  of  Silver. 

To  succinctly  trace  the  narrative  of  this  ingenious  finan- 
cial device  carries  us  back  to  the  point  from  which  I  di- 
verged in  order  to  sketch  the  history  of  the  Supply  and 
Consumption  of  the  precious  metals  in  Europe. 

The  course  of  the  narrative  will  now  be  in  respect  of  the 
relative  value  of  gold  and  silver. 

HISTORY  OF  THE  RELATIVE  VALUE  OF  GOLD  AND  SILVER. 

This  history  naturally  divides  itself  into  four  periods: 
The  Ancient,  Medieval,  Modern,  and  Recent.  The  first 
extending  from  the  most  remote  times  to  the  beffinninof  of 
the  Christian  era  or  failure  of  the  ancient  mines;  the  second 
extending  from  the  last-named  period  when  the  efifects  of 
the  discovery  of  Potosi  were  first  felt;  the  third  from 
that  period  to  the  year  1865,  or  the  date  of  the  arbitrary 
partial  demonetization  of  silver  by  five  nations;  the  fourth 
period  to  the  present  time.  The  accounts  which  have 
come  dow^n  to  us  of  the  Ancient  Period  are  inexact  and  par- 
tial. The  relation  is  either  stated  in  round  figures  by 
some  careless  author  or  calculated  from  laws  the  precise 
meaning  and  application  of  which  are  not  beyond  dispute. 
Each  of  these  accounts  relate  to  a  single  country,  sometimes 
to  a  single  citj-,  and  centuries  occur  between  the  date  of  one 
account  and  another.  Such  as  they  are,  they  are  given 
herewith : 

Table  showing  the  Ratio  of  gold  and  silver  in  various  countries  oj  the  World 

during  the  Ancient  Period. 

B.  C.     Ratio.  Authorities 

1600    13.33    In>criptioii.s    at  Kariiak,    tribute   lists  of    Tliutmosis. 
(Bniuilis.) 
708     13.33     Ciiiififonu  inscriptions  on  plates  found  in  foundation 
of  Kiiorsabad. 
-  13.33    Ancient  Persian  coins;  gold  darics  at  8.3  grams=20 

silver  siglos,  at  5.5  grains. 
500    13.00    Persia.     Darius.     Egyptian  tribute.    Herod.    Ill,   95. 
(.Boeckh,  p.  12.) 


43 

Table —  Continued. 

B.  C.     Ratio.  Authorities. 

490  12.50  Sicily.  TimeofGelon.  "At  least  "12.50.  (BcEckh,p.44.) 
470  10.00  Doubtful.  Asia  Minor.  Xerxes' treasure.  (Boeckh,  p.  11.) 
440    13.00    Herodotus'  account  of  Indian  tributes.     3G0  gold  tal- 

ents=4,GS0  silver. 
420    10.00    Asia  Minor.     Pay  of  Xenophon's  troops  in  silver  darics. 

(Anab. ;  Boeckli,  p.  34.) 
407        -       Spurious  and  debased  gold  coins  .at  Athens.     (McLeod, 

Polit.  Econ.,  p.  470;  Boeckh,  p.  35.) 
400    13.33    Standard  in  Asia,  according  to  Xenophon. 
400    12.00    Standard  in  Greece,  according  to  "Hipparchus;"  attrib- 
uted to  Plato. 
400    12.00-) 

400    13.50  V  Various  authorities  adduced  by  Boeckh. 
400    15.00  J 

1 9  AA 1  Values  in  Greece  from  the  Peloponnesian  war  to  the 
Am  QQR  1  1  tm  I     time  of  Alexander,  according  to  hints  in  Greek  writ- 
4U4-drfb  1  i6.uo  y     g^.^^     Tiiere  were  variations  under  special  contracts— 
'-  ■^'*-^"*  J        unit,  the  silver  draclnua. 
340    14.00    Greece.     Time  of  Demosthenes.     (Boeckh,  p.  44.) 
338-326    11.50    Special  contracts  in  Greece. 
343-323     12.50    Egypt  under  the  Ptolemies. 

300    10.00    Greece.     Continued  depression  of  gold,  caused  by  great 

influx  under  Alexander. 
207    13.70    Rome.     (Bceckli,  p.  44.)    Gold  scriptulum   arbitrarily 

fixed  at  17.143  for  1. 
100    11.91    Rome.     General  rate  of  gold  pound  to  silver  sesterces 
to  date. 
58-49      8.93    Rome.     Continued  depression  of  gold,  caused  by  influx 
of  Ctesar's  spoil  from  Gaul.     [X.  B.— Ca3sar's  head- 
quarters were  at  Aquileia,  at  the  head  of  tlie  Adriatic, 
where  there  was  also  a  gold  mine,  which  at  this  period 
became  very  prolific] 
50    11.90    Rome.     "About  the  year  U.  C.  700  "  tlie  rate  was  11^|. 

(Boeckh,  p.  44.) 
29    12.00    Rome.     Xormal  rate  in  the  last  days  of  the  republic. 

A.  D. 
1-87    11.97    Rome.    Rate  under  Augustus  and  Tiberius. 

None  but  the  gravest  events — events  which  affected 
many  nations,  and  were  felt  through  long  periods  of  time, 
sufficed  to  disturb  this  relation.  The  two  most  note- 
worthy of  these  were  the  vast  spoil  of  Alexander,  which 
he  gathered  in  the  Orient  and  brought  into  Europe,  and 
the  spoil  of  Csesar  in  Gaul,  which  he  sent  to  Rome  by  way 
of  Aquileia.  These  events  temporarily  depressed  gold  from 
the  ratio  of  12  to  that  of  10,  in  the  first  instance,  and  from  12 
to  8,  in  the  second;  but  the  depression  was  both  local  and 
temporary.  Omitting  these  temporary  aberrations,  the 
general  range  of  the  ratio  in  Ancient  times,  so  far  as  the 


44 

evidence  now  available  furnishes  ground  for  opinion,  seems 
to  have  been  about  from  12  to  13.33. 

The  accounts  relating  to  the  Medieval  Period  partake 
more  or  less  of  the  characteristics  peculiar  to  the  ancient. 
Lesser  intervals  of  time  intervene  between  the  dates,  lesser 
distances  between  the  countries,  and  lesser  difi'erences 
between  the  rates  in  one  country  compared  with  another. 
Nevertheless,  the  condition  of  medieval  society  was  too 
unconnected,  and  the  arbitrary  and  conflicting  laws  gov- 
erning the  production,  consumption,  and  legal  attributes 
of  the  precious  metals  iu  various  countries,  are  too  little 
understood  at  the  present  day,  if,  indeed,  they  ever  were 
fully  understood,  to  render  these  quotations  of  practical 
value.     They  will  be  found  below : 


Table  showing  the  Ratio  of  gold  and  silver  in  various  countries  of  the 
World  during  the  Medieval  Period.    Range  11.44  @  13.51. 


A.  D.      Ratio. 


37^1 

54-68 

69-79 

81-96 

138-101 

312 

438 

864 


1344-1660 


1497 
1500 


12.17 
11.80 
11.54 
11.30 
11.98 
14.40 
14.40 
12.00 


1260    10.50 


1351 

12.30 

1375 

12.40 

1403 

12.80 

1411 

12.00 

1451 

11.70 

1163 

11.60 

55-1494 

10.50 

10.70 
10.50 


Authorities. 


Rome. 
Home. 
Rome. 
Rome. 
Rome. 


The    silver    coinage 
imicli  debased,  con- 


seqiientlj^  the  ratio 
of  tlie  metals,  pure, 
was  as  about  1  to  11. 


Reign  of  Caligula. 
Reign  of  Nero. 
Relgii  of  Vespasian. 
Reign  of  Domiriaii. 
Reign  of  Antoninus. 
Byzantium.     Reign  of  Constantine.     Arbitraiy. 
B.yzautimn  and  Rome.    Theodosiau  Code.    Arbitrary. 
Pi-obable  ratio,  as  shown  by  tlie  Edictum  Fistense^ 

under  tlie  Carlovingiau  dynasty. 
Avei-age  i-atio  in  tlic  commercial  cities  of  Italy.     Local 

or  doubtfid. 
England.  jSTumerous  mint  indentures  given  in  Mc- 
Leod's  Political  Economy,  p.  475.  The  ratio,  ex- 
cept when  fixed  arbitrarilj"  and  in  violation  of 
market  price,  varied  between  about  1 :12  and  1:14 
during  the  two  hundred  and  lifty-seven  years  in- 
cludecl  in  tliis  period. 

Ratio  in  Xorth  Germanj^  as  sliown  by  the  very  accu- 
rate rules  of  the  Lnbeclc  mint,  corroborated  in  the 
main  l)y  tlie  accounts  of  tlie  Teutouic  Order  of 
Kniglits,  averaged  iu  i)eriods  of  forty  years. 

Ratio  according  to  the  accounts  of  the  Teutonic 
Kniglits.  As  the  ratio  fixed  in  England  by  nu- 
merous mint  indentures  from  1465  to  1509  was 
about  1  :12,  this  German  ratio  is  considered  local  or 
doubtful. 

Spain.     Reign  of  Isabella.    Edict  of  Medina.    Local. 

Germany.  Adam  Riese's  Arithmetic.  Local  or  doubt- 
ful. 


45 

Table —  Continued. 

A.  D.     Ratio.  Authorities. 

1551     11.17    Germany.     Imperial  Mint  regulations.     Arbitrary  or 

local. 
1559     11.44    German  Imperial  Mint  regulations. 

,  22i     }]  "In  \  France.     Mint  regulations, 
lo/o     11.08  J 

162.1     1]  .74    Upper  Germany.     Mint  regulations. 

1G40    13.51     France.     Mint  regulations!     Transition  period. 

The  extreme  range  of  all  of  the  above  quotations  which 
are  considered  even  measuredly  reliable  18  from  11.44  to 
13.51,  the  latter  a  single  instance  at  the  close  of  the  period 
and  after  the  opening  of  the  American  mines.  Most  of  the 
quotations  come  within  the  range  of  from  11.70  to  12.40, 
which,  considering  that  the  table  covers  a  period  of  sixteen 
centuries  and  numerous  countries  but  little  connected  by 
commerce  until  a  late  period,  serves  to  show  the  remarka- 
ble constancv  of  the  relation  between  the  metals. 

From  the  time  of  the  conquest  of  England,  A.  D.  106G, 
until  the  reign  of  Edward  III  there  was  no  gold  coined  in 
England,*  and  probably  none  in  circulation,  and  this  was 
doubtless  substantially  the  case  also  in  Continental  Europe. 
Taking  this  inference  in  connection  with  the  commonness 
and  large  size  of  gold  coins  in  ancient  times,  we  are  justi- 
fied in  ascribing  the  decrement  of  coin  during  the  medieval 
ages  rather  to  the  falling  off  in  the  supplies  of  gold  than 
to  that  of  silver  and  the  fluctuation  of  the  ratio,  such  as  it 
was,  to  the  aberrations  of  the  gold  supply. 

We  have  thus  an  additional  corroboration  of  the  superior 
stability  of  silver  to  gold :  a  corroboration  still  further 
strengthened  by  the  fact  that  silver  alone  was,  in  fact,  if 
not  always  legally,  the  standard  in  England  f  and  through- 
out Europe  up  to  about  the  beginning  of  the  present  cen- 
tury. 

For  the  Modern  Period  we  have  more  reliable  data.  This 
results  from  the  fact  that  during  this  period  countries  be- 

*  Essay  on  coins  by  Martin  Folkes,  London,  about  1750,  quoted  in  Har- 
ris on  Coins,  ii,  2. 
•f  Han-is,  i,  01 ;  ii,  85  and  ii,  106-7. 


46 

came  united  by  commerce;  and  quotations  in  one  hold  good 
with  slight  variation  for  all  the  others.  As  at  about  the 
commencement  of  this  period  all  those  events  occurred 
vvliich  have  had  any  material  influence  in  altering  between 
the  metals  the  relation  which  previously  existed,  to  wit,  the 
opening  of  the  East  India  and  China  trade,  the  opening  of 
tlie  American  mines,  and  the  use  of  quicksilver  in  the 
amalgamation  of  ores,  it  is  wholly  useless  in  this  or  any 
other  practical  connection,  to  consult  any  other  data  con- 
cerning the  relation  of  the  metals  with  the  view  of  deter- 
miniuo:  such  relation  for  the  future. 


Table  showing  the  Ratio  of  gold  and  silver  in  various  countries  of  the  World 
during  the  Modern  Period^  or  since  the  opening  of  the  East  India  and 
China  trade.     Range  14.74  @  15.83. 


A.  D. 

Ratio. 

Country, 

Authorities. 

1665 

15.10 

Fi'ance. 

Mint  regulations. 

1667 

14.15 

Uppei-  Germany. 

Mint  regulations.     Doubtful. 

1669 

15.11 

Upper  Germany. 

Mint  regulations. 

1670-1817 

England. 

Numerous  mint  regulations  quoted 
by  McLeod. 

1679 

15.00 

France. 

Mint  regulations. 

1680 

15.40 

France. 

Mint  regulations. 

1687-1700 

14.97 

1701-1720 

15.21 

1721-1740 

15.08 

1741-1790 

14.74 

1791-lSOO 

15.42 

-  Hambura: 

1801-1810 

15.61 

o 

1811-1820 

15.51 

1821-1830 

15.80 

1831-1840 

15.67 

1841-1850 

15.83  J 

1851 

15.46] 

1852 

15.57 

1853 

15.33 

1854 

15.33 

1855 

15.36 

1850 

15.33 

1857 

15.27 

1858 

15.36 

1859 

15.21 

1860 

15.30 

England. 


-I 


1 


'Ratios  calculated  from  the  bi- 
weekly quotations  of  the  Ham- 
burg prices-current,  giving  the 
value  of  the  gold  ducats  of  Hol- 
land in  silver  thalcrs  down  to 
1771,  and  after  that  in  fine  silver 
bars.  The  nominal  par  of  ex- 
change during  this  period  was 
1 :14.80,  and  the  quotations  show 
the  variations  of  the  market  rate 
in  percentage  above  or  below 
this.  At  par,  6  silver  marks- 
banco  were  equivalent  to  1  duc- 
at ;  68  20-47  ducats  containing  1 
mark  (weight)  of  fine  gold,  and 
27 J  silver  marks-banco  contain- 
ing 1  mark  (weiglit)  of  fine  sil- 
ver. Hence,  6X68  20-47-^27|= 
14.80,  the  par  i-atio. 

London  market  quotations — an- 
nual averages.  These  give  the 
price  of  a  given  weight  of  stand- 
ard silver  in  sliillings  and  pence. 
The  standard  gold  is  \\t\\s  fine, 
and  an  ounce  Troy  is  coined  into 
934.5  pence,  or  an  ounce  of  fine 


47 


Table —  Continued. 


A.D. 


Ratio.        Country. 


AittJiorities. 


1861 

15.47 

1862 

15.36 

1863 

15.38 

1864 

15.40 

1865 

15.33 

1866 

15.44 

1867 

15.57 

1868 

15.60 

1869 

15.60 

1870 

15.60 

1871 

15.59 

1872 

15.63 

England. 


gold  into  1019.45  pence.  The 
standard  silvei-  is  f^ths  fine. 
Hence,  as  fine  silver  is  wortli 
1.081  times  as  macli  as  standard 
silver,  if  1019.45  pence  he  di- 
vided by  1.081  times  tlie  qnoted 
price  of  an  onnce  of  standard 
silver,  the  quotient  is  the  ratio 
desii'cd. 


Aglanceatthis  table  shows  that  the  extreme  range  of  fluc- 
tuation for  a  period  of  over  two  hundred  years,  closing  with 
the  year  1872,  was  14.74  to  15.83.  Most  of  the  quotations 
are  close  to  15  J  of  silver  to  1  of  gold.  The  change  from  the 
relation  which  existed  during  the  medieval  period  is  at- 
tributable chiefly  to  the  opening  of  the  Oriental  trade  by 
thp  way  of  the  Cape  of  Good  Hope,  and  the  settlement  of 
the  difierent relations  between  gold  and  silver  which  existed 
in  the  Oriental  and  Occidental  worlds.  This  settlement 
took  place  during  the  seventeenth  century ;  since  which 
time  the  ratio  has  remained  almost  stationary  and  uniform 
throughout  the  world. 

I  have  already  stated  that  the  East  India  trade  absorbed 
a  large  proportion,  estimated  at  two-fifths,  of  the  whole 
American  product  of  the  precious  metals;  that  is  to  say,  about 
one-fifth  during  the  seventeenth  centurj^and  one-fifth  dur- 
ing the  eighteenth.  This  proportion  consisted  nearly  alto- 
gether of  silver.  The  result  of  these  shipments  of  silver  to 
the  Orient  was,  that  of  the  supplies  of  American  metal  ab- 
sorbed in  Europe,  a  large  portion  consisted  of  gold.  With 
the  rise  in  prices  which  followed  the  discovery  of  America 
the  demand  for  supplies  of  gold,  as  against  silver,  in  Europe, 
was  greater  than  before,  owing  to  the  superior  availability 
of  gold  at  that  period  for  largo  payments ;  a  superiority 
which  the  subsequent  growth  of  banks  and  places  of  de- 
posit has  now  destroyed.  This  slightly  increased  demand 
for  gold  as  against  silver  must  be  set  off  against  the  urgent 
demand  for  silver  in  the  Orient. 


48 

The  average  ratio  at  Hamburgh  for  the  twenty  years, 
1701-1720,  is  given  in  the  table  at  15.21.  Sir  Isaac  New- 
ton, in  his  report  on  coins,  dated  1717,  estimated  it  at  14.8 
to  15  throughout  Europe. 

At  this  period  the  legal  relation  in  England  was  151- 
and  silver  was,  therefore,  undervalued  by  law.  The  con- 
sequence was  that  a  large  portion  of  the  silver  coin  was 
exported  to  countries  where  it  was  more  justly  estimated. 
To  remedy  the  loss  of  coinage  involved  in  exportation,  the 
weight  of  the  gold  pieces  was  lessened,  and  instead  of  890, 
there  were  coined  out  of  a  pound  of  standard  gold  934| 
sovereigns  of  20  shillings,  or  their  equivalent,  890,  in 
guineas  of  21  shillings;  or,  what  is  the  same  thing,  the 
guinea,  or  pound  of  guinea  gold,  of  20  shillings,  was 
ordered  to  pass  current  at  21  shillings. 

We  are  told  by  modern  apologists  for  the  adoption  of 
the  single  gold  standard  in  England  in  1816,  without  any 
support  for  such  statement,  that  the  single  gold  standard 
was  practically  the  standard  of  England  from  the  time  of 
this  change  in  the  coinage  by  Sir  Isaac  I^ewtou.*  But 
this  fact,  however  "  practical,"  had  nothing  whatever  to  do 
with  the  law  on  the  subject. 

It  appears  that  some  forty  years  after  ITewton's  coinage 
reform,  gold  fell  in  the  markets  of  Europe  until  it  would 
only  purchase  14.74  of  silver,  while  the  law  valued  it  at 
slightly  under.f  Such  being  the  case,  there  arose  an  agi- 
tation favorable  to  the  payment  in  gold  of  the  interest  or 
principal  on  the  public  debt,  which  was  then  largely  held 
abroad. J  The  argument  in  favor  of  this  project  was  en- 
tirely sound.  The  debt  had  been  incurred  in  "pounds." 
The  "pound"  was  a  money  of  account  consisting  of  20  ac- 
tual shillings  of  silver,  each  11  ounces  2  dwts.  fine,  out  of 
12  ounces,  and  weighing  3  ounces  17  dwts.  10  grains;  in 
other  words,  one  pound  Troy  weight,  of  standard  silver. 


*  McLeod. 

12  ILirri?;,  p.  54.  appears  to  make  it  14.1 45,  but  this  is  imprecise. 

1 2  Harris,  53-lOG. 


49 

was  coined  into  62  of  these  shillings.  By  the  same  mint 
indenture  a  pound  Troy  of  standard  gold  was  coined  into 
as  many  guineas  as  there  were  in  890  shillings,  and  by  sub- 
sequent indentures,  previous  to  the  period  of  the  dispute, 
into  as  many  sovereigns  as  there  were  in  9o4i  shillings.* 
Why  not,  then,  pay  the  debt  in   these  gold  "  guineas?" 

The  only  doubt  which  could  arise  as  to  the  equity  of 
this  proceeding  depended  upon  the  fact  as  to  when  (under 
what  indentures)  the  debt  had  been  incurred,  though,  in 
fact,  this  question  was  of  no  importance.  But  it  never 
seemed  to  have  troubled  the  disputants,  who  represented 
that  large  and  influential  portion  of  the  debt  which  was 
held  at  home.  They  stood  upon  the  pound  of  silver;  de- 
clared that  that  was  the  sole  standard  of  value;  that  gold 
coins  were  mere  tokens,  and  that  the  honor  of  the  Crown 
was  involved  in  the  payment  of  the  debt  in  silver  "  pounds," 
which,  in  point  of  fact,  was  only  a  money  of  account,!  and 
had  had  no  actual  existence  in  silver  since  the  days  of 
William  of  Normandy,  and  none  at  all  in  gold. 

The  superior  talent  or  persistency  of  these  advocates  of 
plutocracy  prevailed  over  reason  and  equity,  as  it  prevailed 
afterwards,  when  they  took  the  opposite  side  of  the  argu- 
ment and  showed  that  gold  was  the  standard  of  England, 
and  not  silver;  as  it  has  prevailed  in  this  Chamber;  as  it 
has  prevailed  everywhere  and  at  all  times.  The  books 
and  pamplets  issued  on  the  subject  at  this  period  were  in- 
numerable, and  amidst  the  confusion  which  they  occa- 
sioned, the  unaccustomed  jargon  of  the  mint,  and  the  loud 
voices  of  the  plutocratical  orators,  the  latter  carried  the 
day,  and  silver  was  assented  to  be  the  sole  standard  of 
England. 

Some  seventy  years  later,  while  specie  payments  were 
suspended  in  England,  and  there  was  no  currency  in  cir- 
culation except  unrepresentative  and  irredeemable  bank 
notes,  silver  was  demonetized  by  law,  as  McLeod  says  it 

*McLeod,  Appeutlix,  pp.  9,  10. 
fl  Harris,  i.,  61 ;  Ibid.,  il,  pp.  S.5,  97. 
4 


50 

had  been  in  fact  eiuce  the  period  of  the  measures  effected 
by  Sir  Isaac  Newton,*  and,  except  for  payments  up  to  40 
shillings,  gold  was  declared  the  sole  standard  of  value. 

This  celebrated  Enactment,  the  first  one  specifically  mak- 
ing gold  the  single  standard  of  value  which  was  adopted 
by  any  country,  is  attributed  to  the  same  sinister  influence 
which  nnhistorically  and  illogically  maintained  in  1750-57, 
that  silver  was  or  ought  to  be  the  sole  standard  of  Eng- 
land, because  at  that  period  gold  had  become  slightly  the 
cheaper  metal  of  the  two,  at  the  relation  denoted  by  the 
mint  indentures,  which  had  existed  in  Isaac  l^ewton's 
time.  But  this  inference  does  not  appear  to  be  supported 
either  by  the  market  ratio  of  the  metals  at  that  time,  or 
by  any  other  facts  known  to  the  authors  or  supporters  of 
the  enactment.  The  chief  of  these  supporters  was  Lord 
Liverpool,  whose  report  on  coins  antedates  by  several 
years  the  great  work  of  Humboldt  on  New  Spain,  and  by 
many  years  that  of  Jacob  on  the  History  of  the  Precious 
Metals.  The  principal  fact  in  this  connection  which  was 
known  at  that  time,  and  which  could  have  influenced  the 
adoption  of  the  single  gold  standard,  was  that  silver  had 
been  slowly  falling  in  value  since  the  period  of  the  bank 
suspension.  The  average  market  ratio  for  the  decade 
ending  in  1790,  was  14,74;  while  for  the  decade  ending  in 
1800,  it  was  15.42,  and  for  that  ending  in  1810,  it  was 
15.61.  Beyond^  this,  the  supporters  of  the  act  of  1816 
knew  little  or  nothing  which  could  have  assisted  them  in 
forming  a  judgment  with  regard  to  the  probable  future 
course  of  the  metals.  The  act  of  1816  was  therefore  a 
mere  blunder,  a  piece  of  empiricism  based  at  most  upon  a 
recent,  and  as  it  afterwards  proved,  a  mere  trifling  and 
temporary,  decline  of  silver.  When  we  come  to  trace  its 
consequences  we   shall  see  what  a  deplorable   blunder  it 


*The  authontlc-s  on  this  subject,  viz:  Harris,  1757,  Chevallier,  1857, 
McLeod,  Patterson,  and  Seyd,  disagree  as  to  tiie  legal  position  of  the 
standard  of  England  from  1717  to  ISIG.  Tiie  truth  appears  to  be  that 
the  standard  was  the  double  one. 


51 

was.  Aud  it  is  just  sucli  a  blunder  that  we  would  now 
commit  in  this  country  if  we  disregard  the  present  oppor- 
tunity of  restoring  the  double  standard,  if  we  empirically 
refuse  to  recognize  silver  as  an  essential  and  component 
part  of  the  money  of  the  world,  simpl}-  because,  for  the 
moment,  the  ratio  of  silver  to  gold  is  depressed. 

Having  now  traced  the  standard  of  England  down  to 
its  latest  legal  change,  which  occurred  in  181G,  it  need 
only  be  stated  briefly  in  this  place  that  no  other  country 
adopted  the  gold  standard,  except  Portugal,  until  1865. 
The  standards  of  the  various  principal  countries  of  the 
Occidental  world  previous  to  1865  were  eilher  of  silver,  as 
in  Germany,  Holland,  Scandinavia,  etc.,  or  of  gold  and 
silver  equally,  as  in  France,  Spain,  the  United  States, 
Belgium,  &c.  During  the  interval  between  1809  and 
1848,  when  gold  was  falling  off  in  supply  and  rising  in 
price,  England  entered  upon  that  policy  of  lending  in 
silver  and  demanding  payment  in  gold,  which,  but  for 
the  widespread  bankruptcies  which  the  failure  of  the 
gold  supplies  contributed  to  occasion  in  1837,  would  have 
greatly  enriched  her  wealthy  classes.  They  lent  capital 
to  all  the  countries  of  the  world,  lent  in  the  cheaper 
moneys  of  those  countries,  (as  they  lent  us  later  still 
during  our  civil  war  in  paper,)  and  always  demanded  pay- 
ment in  gold.  Like  all  short-sighted  policies,  it  was  a 
profitable  thing,  so  long  as  it  lasted,  but  its  very  profit- 
ableness forbade  it  to  last. 

The  creditor  may  seek  support  in  unjust  laws,  but 
nature  is  on  the  side  of  the  debtor,  and  nature  redresses 
the  inequalities  of  laws.  As  to  the  effect  upon  her  own 
people  in  demonetizing  silver  during  the  period  when 
gold  was  rising  in  value,  it  need  only  be  said,  that  Eng- 
land never  passed  through  a  more  gloomy  period  than 
during  the  half  century  preceding  the  opening  of  Cali- 
fornia. One  has  only  to  read  Professor  Thorold  Rogers's 
Review  of  Agriculture  and  Prices  in  England  from  the 
thirteenth  to  the  nineteenth  centuries,  and  McKay's  Work- 
ing Classes,  to  be  convinced  of  the  fact  that  during  the 


52 

period,  1816-48,  the  English  laborer  was  reduced  to  a  con- 
dition bat  little  better  than  that  of  his  predecessors  during 
the  Middle  Ages,  and  infinitely  worse  than  that  of  his  pre- 
decessors a  century  before. 

Money  became  scarce,  and  despite  the  alleviation  caused 
by  the  invention  of  banking  and  paper  money,  hard  times 
set  in.  After  1809  the  annual  supply  of  the  precious 
metals  declined  fully  one-half,  owing  to  the  stoppage  of 
the  Mexican  mines,  consequent  upon  the  war  between 
Spain  and  her  American  colonies.  The  period  when  the 
precious  metals  were  most  scarce  was  between  1810  and 
1840 :  and  this,  as  every  one  knows^  was  precisely  the 
period  when  national  distress  and  political  agitation  were 
most  rife  among  us.  The  masses  suiFered  and  clamored 
for  Reform  ;  the  middle  classes  groaned  under  the  taxation 
and  cried  for  Retrenchment;  and  in  Parliament  there 
arose  the  policy  of  Peace,  to  lessen  the  burdens  of  a  nation 
which  could  not  aftbrd  to  go  to  war.  The  discovery  of  the 
Ural  mines  of  Russia  thereafter  began  to  mitigate,  though 
not  to  remove  the  dearth.  But  now,  once  more  a  change 
has  taken  place,  and  the  discovery  of  the  rich  mines  of 
California,  Columbia,  and  Australia,  &c,  (Patterson's 
Econ.  of  Capital,  p.  45.) 

There  is  another  point  in  this  connection  which  is  well 
worth  mentioning  to  those  who  have  shown  so  much 
eagerness  to  lead  this  country  into  the  unwise  footsteps 
which  England  has  trodden  in  respect  of  the  standard  of 
money.  It  may,  perhaps,  not  have  occurred  to  them  that  with 
a  system  of  household  suffrage,  such  as  exists  in  England, 
the  slightest  rise  in  values  has  the  effect  of  extending  the 
franchise  of  voting.  This  was  shown  by  Mr.  Patterson  in 
his  Economy  of  Capital,  pp.  60,  et  seq  : 

"  Houses  which  rented  at  £8  in  1848  are  now  rented  at 
£10,  which  secures  the  franchise  for  the  occupiers.  *  * 
Taking  the  case  of  England  in  the  nineteen  years  before  the 
new  gold  supplies  came  into  play  we  find  that  between  1832 
and  1851,  the  registered  electors  for  burghs  increased  one- 
half  and  those  for  counties  more  than  one-third,  while  the 
total  population  increased  less  than  one-third." 


53 

Here,  then,  is  a  reason,  in  addition  to  their  pecuniary 
interest,  which  actuates  the  ruling  classes  of  England  in 
their  monetarj^  legislation,  a  reason  that  should  teach  us 
of  America  to  beware  what  hidden  pits  we  may  fall  into 
by  blindly  and  subserviently  following  the  politico-eco- 
nomical or  legislative  footsteps,  be  they  backward  or  for- 
ward, of  a  foreign  country. 

We  need  no  foreign  advice  in  the  great  concerns  of  State. 
When  that  greatest  of  all  political  events — the  American 
Revolution,  which  not  only  gave  freedom  to  this  people, 
but  for  the  first  time  in  the  history  of  the  world  divorced 
Church  and  State,  denied  the  "divine  right"  of  kings, 
the  privileges  of  class,  and  the  claims  of  feudalism,  and 
thus  gave  to  all  men  at  once  the  principles  of  government 
and  a  land  in  which  those  principles  could  be  carried  into 
practice — when  the  American  Revolution  was  organized, 
did  our  forefathers  send  to  ask  the  opinion  of  the  ruling 
classes  of  Europe?  No.  They  knew  that  if  they  did  so 
the  answer  that  they  would  get  would  be  unfavorable  to 
the  accomplishment  of  their  ends.  These  ends  were  the 
freedom  and  happiness  of  all  men.  These  are  what  they 
had  fought  for  and  determined  upon,  and  they  needed  no 
advice  as  to  how  they  should  secure  them  in  that  organ- 
ization of  a  State  which  had  been  committed  to  their 
charge. 

We  now  come  to  the  effects  of  the  gold  discoveries  in 
California,  which  effects,  preceded  as  those  discoveries  had 
been,  by  the  minor  ones  of  Ural  and  Siberia,  were  felt 
soon  after  the  events  that  gave  rise  to  them.  At  this 
period,  about  the  year  1850,  England  still  had  the  single 
gold  standard,  the  United  States  the  double  standard  at 
16,  France  the  double  standard  at  15J;  Spain,  Holland 
and  Belgium,*  che  double  standard  ;  and  Germany,  N^a- 
ples,t  and  other  countries,  the  single  silver  standard.  In  a 
word,  the  silver  unit  (dollar,  thaler,  franc,  real,  or  rouble) 
was  a  legal  tender  to  an  unlimited  extent  in  all  these 
countries  except  England. 

*  Chevalier,  pp.  6,  157,  159, 163.  flbid.,  p.  169. 


54 

When  gold  began  to  pour  in  from  the  shores  of  the 
Pacific  the  first  and  very  proper  act  of  the  United  States 
and  France  was  to  coin  gold  pieces  and  use  them  instead 
of  silver  ones  for  legal  tender.  The  United  States,  still 
holding  on  to  her  double  standard,  stopped  coining  the  sil- 
ver dollar,  and  by  the  act  of  1853,  coined  a  gold  one,  be- 
cause it  was  the  cheaper  one.  France  also  held  on  to  her 
double  standard  (of  15 J)  notwithstanding  the  eloquence  of 
Chevalier,  who,  like  Harris  in  England,  precisely  a  century 
before,  tried  to  convince  France  that  the  law  of  7th  Ger- 
raenal,  Anno  XI,  (year  1803,)  meant  a  single  silver  stand- 
ard instead  of  a  double  one.  The  first  care  of  these  two 
great  republics  was  the  interests  of  their  people,  and  these 
interests  they  consulted  when  they  held  on  to  a  system 
which  looks  to  and  utilizes  the  whole  supply  of  the  pre- 
cious metals  for  the  basis  of  commercial  transactions. 

Plolland  and  Belgium  pursued  a  different  course.  These 
countries,  like  England,  were  governed  by  kings,  sur- 
rounded by  a  powerful  plutocracy.  Like  her  they  were 
lenders  of  money,  the  creditors  of  other  nations,  and  like 
her  they  feared  the  fall  of  gold.  But  unlike  England,  they 
had  had  no  single  gold  standard  before;  no  gold  standard 
while  gold  was  becoming  scarce,  as  during  the  period 
1816-1840  ;  therefore  no  distress,  no  agitations,  no  Chartist 
riots,  no  reform  bills,  no  clamor  for  popular  representa- 
tion, no  demand  for  ministerial  responsibility.  Hence, 
unlike  the  British  plutocrats,  those  of  Holland  and  Bel- 
gium had  no  fears  to  restrain  them  from  adopting  a  single 
silver  standard  when  silver  became  dear.  Belgium  retired 
her  gold  coins  in  1854,*  and  adopted  a  silver  standard. 
Holland  did  the  same  thing  in  1858. t 


*  After  having  cut  off  her  owa  tail,  Belgium,  through  the  agency  of  her 
distinguished  plutocratical  politico-economist  M.  Gustave  de  Molinari,  en- 
deavored to  induce  France  to  do  the  same  thing.  This  effort  was  made 
through  the  medium  of  the  pages  of  the  Economiste  Beige  of  10th  February, 
1857,  in  which  M.  Molinari  recommended  France  to  demonetize  gold  by 
reducing  her  gold  coins  to  tokens,  and  adopt  the  single  silver  standard  after 
Belgium. 

t  iMcCuIloch  Die,  Art.  "Precious  Metals,"  says  1847  and  1849. 


55 

The  success  of  tlie  ruling  classes  in  Holland  anJ  Belgium 
in  demonetizing  gold  during  this  period  of  its  downfall  was 
greatly  envied  by  their  brethren  in  England.  Between  1850 
and  1857  gold  fell  from  15.83  to  15.27  of  silver,  the  extrera- 
est  range,  as  it  has  since  proved,  during  more  than  eighty 
years,  to  wit,  from  1790  to  1872.  The  creditor  classes  of 
England  viewed  this  depression  of  their  favored  metal  with 
great  alarm,  and  fancied  that  it  would  go  on — as  with  the 
same  short-sightedness  they  now  fancy  that  the  present  tem- 
porary depression  of  silver  will  go  on — forever.  Forgetting 
that  they  had  profited  while  gold  rose,  they  now  demanded 
that  they  should  not  lose  beciiuse  gold  was  falling.  They 
looked  with  envy  upon  the  plutocratical  legislation  of  Hol- 
land and  Belgium,  and  asked  why  England  should  not 
also  demonetize  gold  and  adopt  silver  as  her  sole  standard 
of  value. 

Unfortunately  for  them,  their  own  short-sighted  and 
blundering  legislation  of  1816  stood  in  the  way,  and  ISTature 
was  reaping  its  revenge.  What  was  to  be  done?  What 
had  England's  plutocratical  politico-economists  to  advise 
at  this  period? 

Mr.  Richard  Cobden,  while  disclaiming  any  right  on  the 
part  of  the  government  to  interfere  with  contracts  already 
made,  saw  no  reason  why  it  should  be  excluded  from  such 
interference  with  the  future  as  might  be  necessary  to  facili- 
tate voluntary  contracts.     (Chevalier,  p.  6.) 

Mr.  James  Maclaren  recommended  the  establishment  of 
life  insurance  companies  on  the  basis  of  a  silver  standard. 
(Ibid.) 

Mr.  Cobden,  quoting  this  suggestion  with  approbation, 
proposed  to  adapt  it  to  all  contracts  extending  over  a  long 
period  of  time,  and  even  thought  of  evading  the  conse- 
quences of  the  depreciation  of  gold  by  resorting  to  the 
primitive  practice  of  paying  in  kind,  as  by  granting  farm 
leases  upon  a  rent  to  be  regulated  by  the  price  of  pro- 
duce!* 0  sophistry,  sophistrj^  how  desperate  are  thy  con- 
volutions! 

*Iii  Jevou's  latest  work  Messrs.  Scrope  &  Lewis  are  quoted  as  in  favor 
of  adoptintj  the  av(M-a;;'e  of  one  lumdred  articles  of  produce  as  the  meas- 
ure of  value. 


56 

In  short,  England  was  fairly  caught  in  her  own  toils, 
and,  but  for  the  retention  of  the  double  standard  in  the 
United  States,  France,  and  other  countries,  which  enabled 
these  countries  to  absorb  the  new  supplies  of  gold  by  re- 
placing with  them  their  silver  coins,  which  they  exported 
to  Asia,  wherewith  to  pay  for  goods,  the  relations  of  com- 
modities and  services  in  England — and  this  involved  her 
entire  political  structure — would  have  been  revolutionized. 
As  it  was,  her  government  barely  escaped  overthrow,  and 
the  agency  that  saved  her  was  that  very  double  standard 
which  the  sellishness  and  folly  of  1816  had  overthrown  in 
England,  but  which,  fortunately  for  England,  other  nations 
had  retained. 

The  consequences  of  these  various  measures,  during  the 
fall  of  gold  from  1848  to  1865,  were  that  England  pros- 
pered in  spite  of  her  foiled  plutocracy,  France  prospered, 
and  the  United  States  prospered,  and  an  era  of  industrial 
activity  was  opened  in  these  three  great  countries  the  like 
of  which  had  never  been  seen  before.  This  was  the  dis- 
tinctive era  of  labor-saving  machines,  international  expo- 
sitions, railways,  life  insurance,  clearing-houses,  and  great 
commercial  reforms. 

THE    RECENT  PERIOD. 

Table  showing  the  ratio  of  gold  and  silver,  chiejlg^  in  the  London 
•market,  during  the  Recent  Period,  or  since  the  Demonetization 
of  Silver  effected  by  the  act  of  February  12,  1873.  Range 
15.9  @  17.82. 

Year.            Ratio.  Couiitiy.                                              Authorities. 

1873 15.90  England.  Annual  av'gcalculated  as  above. 

1874—-  16.15  England.  '' 

1875 16.45  England.  January.--^ 

1875 16.41  England.  Februarv--  V  Average  16.45 

1875— -  16.50  England.  March -"'—J 

1875-—  16.47  England.  April \ 

1875 16.55  England.  May V  Average  16.63 

1875-—  16.88  England.,     June J 

*Th('  table  from  wlilcli  tlie  quotations  for  1875  and  1876  are  obtained 
is  "decUiced  from  quotations  on  the  London  and  Xew  York  markets." 


57 

Tahle —  Continued. 


Year. 

Ratio. 

Country. 

Authorities. 

1875-  — 

16.97 

England. 

July, 

1875-  — 

16.92 

England. 

August. 

^Average  16.88 

1875--- 

16.74 

England. 

September. 

1875-  — 

16.74 

England. 

October  --_ "] 

1875--- 

16.75 

England. 

November- 

>  Average  16.79 

1875-  — 

16.89 

England. 

December-  J 

1876-  — 

17.08 

England. 

January  -_-  ^ 

1876-  — 

17.46 

England. 

February-- 

>  Average  17.45 

1876-  — 

17.82 

England. 

March 

1876-  — 

17.69 

England. 

To  April  12. 

17.69 

We  now  come  to  the  next  important  change  in  the  history 
of  money  and  the  standard — the  era  of  the  silver-bearing 
mines  of  the  Comstock  lode,  of  the  demonetization  of  silver 
in  several  important  countries  of  continental  Europe,  and 
its  demonetization  in  the  United  States  through  the  agency 
of  the  act  of  1873. 

This  era  opened  in  1862  with  the  exportation  of  the  en- 
tire stock  of  silver,  as  well  as  other  coin,  of  the  United 
States,  consequent  upon  the  adoption  of  an  unrepresenta- 
tive paper  currency  by  the  act  of  February  25th  of  that 
year.  In  the  same  year  also  occurred  the  discovery  of 
the  great  silver-bearing  mines  of  Washoe. 

The  ratio  of  silver  to  gold  in  the  markets  of  the  world 
was  thus  threatened  with  depression  from  two  causes  acting 
simultaneously:  1.  The  demonetization  of  a  large  stock  of 
coin  by  an  important  country  ;  2.  The  discovery  of  new 
and  very  productive  silver  mines.  It  was  not  forgotten  by 
financiers  that,  together  with  our  silver,  we  demonenzed 
a  much  more  valuable  stock  of  gold,  nor  that  Washoe  was 
still  in  its  incipiency.  Therefore,  it  was  not  until  1863  or 
1864  that  the  bearing  of  the  events  of  1862  upon  the  prob- 
able future  ratio  of  silver  and  gold  began  to  be  discussed 
in  Europe.  Their  bearing,  however,  was  not  wholly  dis- 
missed from  consideration,  and  as  the  Washoe  mines  gave 
more  and  more  promise  of  great  production,  discussion 
in  Europe  with  regard  to  the  tendency  of  the  ratio  became 
more  and  more  common. 


58 

In  England  the  anticipated  decline  of  silver  was  regadred 
with  great  complacency.  It  was  a  veritable  windfall  for 
her  plutocracy ;  a  parachute  to  retard  the  previously 
threatening  decline  in  the  purchasing  power  of  gold;  a 
governor  to  that  engine  of  their  own  construction,  which 
they  had  built  in  1816  and  regretted  since  1848. 

As  the  great  mines  of  AYashoe  became  further  devel- 
oped tlie  continental  plutocracy  also  began  to  prick  up  its 
ears.  It  was  at  this  period  organized  and  formidable, 
which  is  more  than  can  be  said  of  it  in  1848,  when  the 
Red  flaff  flaunted  in  its  face  from  every  corner  of  Europe. 
France  was  now  an  empire;  Italy  a  united  kingdom; 
Greece  a  newly  fledged  monarchy.  The  plutocrats  of 
these  countries  could  have  their  own  way  now. 

Nature,  steam,  and  the  Comstock  lode  labored  for  man- 
kind; the  silver  treasures  of  the  Sierra  Nevada  began  to 
make  themselves  felt  in  the  coinages;  the  gold  product 
fell  oft",  and  gold  went  up  to  nearly  16  of  silver.  It  was 
therefore  in  the  interests  of  the  plutocracies  to  demonetize 
silver  and  adopt  gold  as  the  sole  standard  of  value,  and  they 
endeavored  to  convince  society  that  gold  alone  was  the 
true  standard. 

The  reading  world  was  flooded  with  pamphlets  and 
magazine  articles  on  the  subject,  penned  by  the  highest 
order  of  talent,  which,  too  often  neglected  by  the  people, 
is  forced  to  ally  itself  with  power;  conventions,  with  cut- 
and-dried  programmes,  were  called  to  discuss  the  matter; 
advocates  were  employed  and  charlatans  retained  to  drown 
with  the  clamor  o±  numbers  the  modest  voices  of  science, 
equity,  and  reason.  Another  motive  urged  the  plutocracies 
to  their  course.  So  long  as  silver  was  harbored  as  a  legal 
tender  in  Europe,  the  United  States,  by  being  the  principal 
producer  of  that  metal,  might  become  the  money  center  of 
the  world — a  matter  of  no  little  concern  to  London,  Paris, 
and  Berlin. 

An  international  monetary  convention  was  held  in  Paris 
in  1865,  and  a  treaty  concluded  between  France,  Belgium, 
Italy,  and   Switzerland,  in   which   Greece  and  Roumania 


59 

subsequently  joined,  by  virtue  of  which  these  countries  so 
limited  the  mintage  of  their  legal  tender  silver  coins  as 
to  prepare  to  make  gold  their  sole  standard  of  value,  and 
partially  demonetize  silver.  Taught  by  previous  expe- 
rience, they  did  not  actually  demonetize  silver,  but  left  the 
law  in  such  a  condition  that  by  a  concerted  change  in  the 
coinage  regulations,  either  gold  or  silver,  if  need  be,  could 
be  made  the  sole  legal  tender,  and  by  adopting  whatever 
happened  to  be  for  the  time,  the  dearer  metal,  a  see-saw 
between  silver  and  gold  could  be  kept  up  for  the  benefit 
of  plutocracy  at  every  change  of  market  relation. 

There  can  be  no  see-saw  unless  tlie  legal  relation  between 
the  metals  is  permanently  fixed  and  unalterable.  When 
fhis  relation  is  altered  from  time  to  time,  as  it  should  be, 
(once  in  ten  or  twenty  years  would  practically  be  often 
enough,)  to  accord  with  the  slow  fluctuations  of  the  mar- 
kets, neither  the  creditor  who  would  demand  the  dearer 
metal,  nor  the  debtor  who  would  profler  the  cheaper  metal, 
could  profit  by  having  his  choice.  But  when  the  relation 
is  unalterably  fixed  or  difficult  to  alter,  as  is  the  case  in 
France,  then  the  creditor  who  receives  in  the  metal  that 
abroad  commands  a  premium,  or  the  debtor  who  pays  in 
the  one  that  can  be  purchased  abroad  at  a  discount  in 
the  one  which  is  the  legal  tender,  derives  an  advantage. 
It  is  the  monkey  and  the  cheese  between  the  two  cats. 

This  treaty  of  1865  was  to  last  until  1880,  and  with  cer- 
tain modifications  is  still  in  force.  England  did  not  enter 
into  it.  Gold  was  now  to  become  dearer,  and  in  her  pres- 
ent political  condition,  when  popular  interests  have  the 
power  to  be  heard,  her  plutocrats  feared  to  open  a  question 
which  might  overthrow  the  advantages  they  already  pos- 
sessed. England  had  a  single  and  peremptory  gold  stand- 
ard. Why  should  she  enter  into  a  treaty  which  would 
make  her  a  party  to  only  a  permissive  gold  standard,  a 
standard  which,  practically,  when  the  treaty  expired,  and 
before  gold  fell  in  price  again,  might  be  changed  by  a 
concerted  coinage  regulation? 

But  although  British  plutocracy  saw  nothing  to  be  gained 


60 

by  entering  into  the  monetary  treaty  of  1865,  it  saw  some- 
thing to  be  gained  by  attending  the  Congress  which  pre- 
ceded tlie  treaty  and  the  subsequent  convention  which  was 
held  in  1867  with  the  view  to  extend  the  operation  of  the 
treaty.  That  something  was  to  draw  the  United  States 
into  the  treaty,  the  United  States  which  were,  as  yet,  not 
bound  to  a  gold  standard  at  all,  either  permissive  or  obliga- 
tory. 

Accordingly  England  sent  her  delegates  to  both  conven- 
tions. They  were  instructed  to  say  nothing  which  would 
bind  England,  but  to  carefully  watch  and  report  the  proceed- 
ings until,  I  presume,  the  hands  of  the  United  States  were 
fairly  into  the  lire  and  the  chestnuts  safely  landed  for  the 
benefit  of  the  ruling  classes  of  England.  These  instructions 
were  carried  out  with  great  skill.  The  Frenchmen  arranged 
the  programme,  the  Germans  did  the  arguing  and  philos- 
ophizing, the  Englishmen  listened,  and  the  American  dele- 
gate, overcome  by  the  plutocratical  atmosphere  that  sur- 
rounded him,  walked  straight  into  the  trap  that  had  been 
set  for  him.  The  convention  was  called  for  the  nominal  pur- 
pose of  unitizing  the  weights  of  the  coins  of  various  nations. 
Its  real  object,  which  it  fully  accomplished,  was  to  commit 
the  United  States  to  the  adoption  of  the  gold  standard  while 
gold  was  growing  dearer,  so  that  the  interest  and  principal 
of  her  public,  corporate,  and  mercantile  indebtedness,  held 
mainly  in  Europe,  which  was  then  under  our  laws  payable 
in  the  silver  dollar  of  371J  grains  pure,  should  be  made 
payable  in  the  temporarily  more  valuable  gold  dollar  of 
23.22  grains  pure.  Of  course  the  United  States  was  not 
bound  by  this  vote  of  its  delegate  in  the  International 
Monetary  Convention,  but  the  vote  had  its  influence.  It 
tended  to  sway  the  judgment  of  the  Congress  of  the  United 
States  when  the  question  came  up,  that  is  to  say,  tended  to 
sway  it  so  far  as  it  was  called  into  exercise  at  all. 

DEBATE  ON  THE  AMERICAN  DEMONETIZATION  ACT  OF  1873. 

But  the  manner  in  which  this  legislation  was  effected 


61 

leaves  but  little  reason  to  infer  that  any  deliberate  judg- 
ment was  exercised  on  this  important  subject  of  the 
standard,  or  that  the  question  was  ever  so  presented  to 
the  American  people  as  to  elicit  the  indorsement  or  the 
approval  of  any  single  congressional  constituency.  The 
bill  by  which  it  was  effected,  originated,  as  I  understand 
it,  in  another  bill  which  was  introduced  into  the  House  of 
Representatives,  February  9, 1872.  It  was  discussed  for  a 
few  moments  on  April  9,  1872.  Then  the  discussion  was 
cut  short,  and  a  substitute,  the  present  law,  reported  by 
title  on  May  27,  and  passed  without  a  reading,  under  a 
suspension  of  the  rules,  Ma}'  29,  1872.  From  the  House 
it  went  to  the  Senate,  where,  without  any  discussion  at  all 
upon  the  all-important  section  fourteen,  it  passed ;  and, 
after  concurrence  bv  the  House,  ag-ain  without  a  discus- 
siou,  became  a  law. 

I  am  aware  that  it  has  been  stated  that  the  bill  was 
passed  after  very  full  discussion  on  this  subject:  but  I  am 
unable  to  find  a  corroboration  of  this  statement  in  the 
ofiicial  report  of  the  proceedings.  If  any  such  full  dis- 
cussion appears  in  the  Record,  1  shall  be  glad  to  have  it 
pointed  out,  in  order  that  I  may  correct  the  impression 
now  on  my  mind  in  respect  of  this  matter. 

This  bill  was  originally  reported  to  the  House  of  Repre- 
sentatives February  9,  1872,  from  the  Committee  on  Coin- 
age, Weights,  and  Measures,  by  its  chairman,  Mr.  Hooper,, 
of  Massachusetts.  It  was  discussed  for  the  first  time  April 
9,  1872,  when  Mr.  Eooper  informed  the  House  that  Mr. 
Ernest  Seyd,  of  London,  a  distinguished  writer  on  coins, 
had  examined  the  first  draft  of  the  bill  and  "  furnished 
many  valuable  suggestions  which  have  been  incorporated 
in  the  bill."  Curiousl}^  enough,  Mr.  Seyd  is  an  uncompro- 
mising advocate  of  the  double  standard,  and  it  is  to  be 
regretted  that  having  received  Mr.  Seyd's  advice,  the 
committee  only  saw  fit  to  follow  it  wherein  it  was  entirely 
unessential  and  to  disregard  it  in  its  most  important  fea- 
ture. Mr.  Hooper  then  assured  the  House  with  regard  to 
section  fourteen,  where  the  standard  was  changed  by  impli- 


62 

cation  from  the  double  to  a  single  gold  one,  that  the  reason 
for  this  chancre  was  that  the  silver  dollar  was  worth  $1.03,  a 
mere  accidental  and  temporary  fact  which  afforded  no 
sound  reason  for  abandoning  the  double  standard.  Subse- 
quent events  have  proved  that  the  option  which  we  then 
enjoyed  of  paying  in  silver  or  gold  dollars  at  pleasure  was 
of  the  highest  importance  to  the  American  people,  and 
should  not  have  been  surrendered.  Even  if  the  fact  as  to 
the  premium  on  the  silver  dollar  were  permanent  and 
assured,  the  simple  remedy  would  have  been  to  change  the 
legal  relation  between  gold  and  silver. 

Mr.  Hooper  also  stated  that  the  single  gold  standard  had 
been  adopted  in  Great  Britain  and  most  of  the  European 
countries,  which  latter  statement  was  certainly  not  correct. 
(Cong.  Record,  2d  Sess.,  42d  Cong.,  part  3,  p.  2305.) 

Mr.  Stoughton,  who  followed  Mr.  Hooper,  repeated  the 
statement  that  the  silver  dollar  was  worth,  he  said,  3^  per 
cent,  premium.    (P.  2309.) 

Mr.  Kelle}^  who  followed  Mr.  Stoughton,  said  it  was 
worth  3i  per'cent..     (Pp.  2311  and  2316.) 

Mr.  Potter,  of  ^ew  York,  appeared  to  be  the  only  mem- 
ber, beside  the  movers,  who  suspected  the  real  character  of 
the  bill.  He  said,  (p.  2310:)  "  I  confess  that  the  introduc- 
tion of  the  bill  at  such  a  period  (during  a  suspension  of 
specie  payments)  excited  ray  suspicion.  I  was  and  am  at  a 
loss  to  gather  from  anything  I  know  or  can  learn  that  there 
is  any  necessity  for  the  adoption  of  this  measure  now," 
Among  the  objections  he  had  to  the  bill  was  that  "it  pro- 
vides for  the  making  of  changes  in  the  legal  tender  coin  of 
the  country,  and  f)r  substituting  as  legal  tender,  coin  of 
only  one  metal,  instead  as  heretofore  of  two."  (P.  2310.) 
Finally  he  stigmatized  the  bill  as  a  cover,  and  that  it  was 
"gotten  up  to  be  a  cover,"  among  other  things,  for  the 
coinage  of  nickel  pieces  in  order  to  enhance  the  market 
value  of  nickel  and  benefit  the  monopolizers  of  nickel 
mines  and  processes.     (P.  2312,) 

And  the  impartial  observer  at  the  present  time  finds  it 


63 

difficult  to  account  for  the  introduction  of  such  a  bill  when 
specie  payments  were  suspended  and  unprovided  for,  un- 
less upon  some  such  ground  as  Mr.  Potter  suggested,  to 
wit,  either  the  interest  of  the  owners  of  nickel  mines  at 
home  or  that  of  creditors  at  home  or  abroad. 

But  of  what  avail  was  argument  or  objection?  The 
discussion  was  cut  short  by  a  motion  to  adjourn,  and  the 
discussion  was  never  renewed.  The  next  we  hear  of  the 
bill  is  that  it  was  pushed  through  on  the  27th  May,  under 
a  suspension  of  the  rules,  without  even  a  reading,  and  that 
it  went  to  the  Senate.  (P.  3883.)  There  it  was  reported 
by  title  on  the  28th  May,  referred  by  title  to  the  Finance 
Committee  on  the  29th  May,  and  passed  at  the  following 
session,  without,  so  far  as  can  be  ascertained  from  the  Con- 
gressional Record,  having  ever  been  fully  considered. 

\  CAUSES    OF   THE    RELATION    OF    15J. 

Turning  away  from  these  details  to  the  general  history 
of  the  relative  value  of  the  precious  metals,  the  principal 
and  by  far  the  most  important  flxct  to  be  observed  is  the 
remarkable  steadiness  which  this  relation  has  shown  for 
over  two  hundred  years. 

The  question  now  arises  concerning  this  constancy  in 
the  relation  in  value  of  gold  and  silver  since  the  earlj^  part 
of  the  seventeenth  century.  To  what  is  it  due?  We  have 
seen  that  this  relation  has  been  almost  constantly,  and  with 
slight  variation,  15|.  Why  has  the  pivotal  point  of  this 
relation  been  just  15|-?  Why  not  13,  as  in  the  days  of 
Herodotus?  Why  not  12,  as  in  the  Feudal  Ages?  Why 
did  it  not  fall  to  20  when  Potosi  poured  its  silver  treasures 
upon  the  world?  In  short,  why  did  it  center  at  15|  and 
remain  there?  A  satisfactory  answer  to  this  question 
cannot  ftiil  to  be  important,  because  it  will  afford  a  guide 
which  will  enable  us  to  compute  the  probable  variation  of 
the  relation  between  silver  and  gold  in  the  future. 

Since  the  opening  of  the  East  Indies  and  China  trade  in 
the  early  part  of  the  seventeenth  centurj^  the  relation  of 


64 

gold  and  silver  in  the  Occident  and  gold  and  silver  in  the 
Orient  became  equalized.  At  the  same  era,  also,  the 
Spanish-American  silver  mines  were  opened,  and  the  use 
of  quicksilver  in  amalgamating  ores  discovered.  These 
three  events  changed  the  pre-existing  relations  in  the 
whole  world.  The  first  raised  the  value  of  silver,  the  sec- 
ond and  third  lowered  it;  the  three  together  placed  it  at 
15|,  kept  it  there,  and  equalized  it  all  over  the  world. 
The  Oriental  trade  continues,  the  American  silver  mines 
are  still  productive,  the  process  of  amalgamation  is  still  era- 
ployed.  Therefore  the  conditions  of  production  and  con- 
sumption are  essentially  the  same  as  they  have  been  for 
over  two  hundred  3^ears.  When  we  consult  those  condi- 
tions with  the  view  of  determining  the  cause  of  the  relation 
between  gold  and  silver,  we  find  that  the  same  quantity  of 
capital,  superintendence,  labor,  or  of  those  commodities 
necessary  to  support  capitalists,  superintendents,  and  labor- 
ers, as  food,  clothing,  shelter,  &c.,and  of  materials,  such  as 
quicksilver,  tools,  machines,  &c.,  as  are,  on  the  average, 
employed  to  extract  fifteen-and-a-half  pounds  of  silver 
from  the  earth,  will  only  produce  one  pound  of  gold.  This 
is  the  average  of  all  countries  and  of  over  two  hundred 
years  of  trial.  It  comes  to  this  at  last.  This  is  the  boiling 
down  of  the  whole  subject. 

It  will,  of  course,  be  understood  that  the  several  rewards 
of  capitalists,  superintendents,  and  laborers,  in  other  words, 
their  share  of  production,  differs  in  various  countries,  and 
has  diflJered  at  various  periods  ever  since  the  opening  of 
India  and  America.  So,  also,  has  the  effectiveness  of  labor- 
ers. Ilence,  the  reward  of  each  of  these  classes  of  persons 
has  differed  enormously.  But,  as  under  the  same  difficul- 
ties of  production — and  these  have  not  changed  as  between 
the  metals  during  the  past  two  centuries,  and  are  not  likely 
to  change  in  the  future — the  sum  total  of  their  contribu 
tions  to  the  work  has  been  the  same,  it  follows  that,  as 
before  stated,  it  is  the  total  outlay  of  capital  and  labor, 
applied  respectively  to  gold  and  silver,  that  has  determined 
the  relation  of  value  between  them. 


65 

When,  at  any  given  time  or  in  any  given  country,  the 
same  outlay  of  capital,  labor,  materials,  etc.,  that  is  suffi- 
cient to  result  in  the  production  of  one  pound  of  gold,  if 
removed  from  gold  and  applied  to  silver  mining,  will  pro- 
duce more  than  15|  pounds  of  silver,  the  labor,  materials, 
etc.,  will  be  removed  from  the  production  of  gold  to  that 
of  silver.     When,  at  another  time  or  in  S,nother  place,  the 
outlay  sufficient  to  result  in  the  production  of  15|  pounds 
of  silver  if  devoted,  instead,  to  gold,  will  produce  a  frac- 
tion more  than  one  pound  of  gold,  it  will,  as  a  matter  of 
course,  be  devoted  to  gold.     The  same  laborers  and  the 
same  capital,  plant,  tools,  materials,  etc.,  are   not  always 
removed  from  one  industry  to  the  other.     One  industry 
ceases  in  one  place  ;  the  other  may  spring  up  in  another 
place.     It  amounts  to  the  same  thing  either  way.     These 
changes  do  not  occur  on  the  instant;  they  come  about  in 
time.     When  mines  cease   to  be  profitable  at  the   long- 
established  relation  in  value  of  silver  and  gold — a  relation 
that  finds  its  reflection  in  the  prices  of  the   services  and 
commodities   necessary  to  carry  on   the  works — they  are 
not  abandoned  at  once,  but  continued  in  the  hope  of  im- 
provement.    If  no   such  improvement  occurs  they  must 
eventually  stop,  for  men  will  not  and  cannot  go  on  forever 
losing  money  at  mining. 

This,  then,  is  the  basic  reason  for  the  long  time  relation 
in  value  of  silver  and  gold.  The  average  result  of  over  two 
hundred  years  of  experiment  in  all  partsof  the  world  assures 
us  that  15J  pounds  of  silver  and  1  pound  of  gold  are 
equivalents,  and  this  assurance  is  as  solidly  supported  in 
respect  of  the  future  as  we  find  it  in  respect  of  the  past. 
N"ow  that  the  most  remote  parts  of  the  world  are  connected 
by  commerce,  nothing  can  weaken  it,  unless  it  were  pos- 
sible that  some  very  great  and  peculiar  improvement  in 
mining  or  the  recovery  of  ores  could  take  place  in  respect 
of  one  metal  and  not  of  the  other.  For  example,  suppose 
an  improved  method  of  extracting  or  recovering  gold  was 
devised  which  was  inapplicable  to  silver:  then  gold  would 
be  produced  more  cheaply  than  now  and  silver  would  rise 


66 

in  value,  or  vice  versa,  in  case  the  improvement  could  be 
applied  to  silver  and  not  to  gold. 

But  this  is  impossible:  first,  because  the  nature  and 
qualities  of  the  two  metals  are  so  nearly  alike  that  any  im- 
provement applicable  to  the  extraction  or  recovery  of  one 
must  appl}^  also  to  the  other ;  and,  second,  because  the 
geological  distribution  of  the  two  metals  is  such  that,  in 
many  of  the  large  deposits  of  the  world,  they  lie  together 
in  the  same  matrix.  They  must  therefore  be  taken  out 
together,  and  the  quartz  which  contains  them  both,  must 
be  crushed,  amalgamated,  separated,  and  refined  by  one 
and  the  same  process.  The  quartz  matrices  of  the  mines 
of  the  Sierra  xTevadas  generally  contain  about  1,000  Troy 
grains  of  gold  to  every  24,000  grains  of  silver,  or  about 
40  per  cent,  iu  value  of  gold  to  60  per  cent,  in  value  of 
silver,  and  the  proportion  in  other  great  silver  mines  of 
the  world  varies  from  20  to  50  per  cent,  in  value  of  gold 
to  that  of  the  two  metals  combined. 

Here,  then,  we  liave  an  unalterable  reason  why  all  im- 
provements iu  the  art  of  mining  the  precious  metals  must 
apply  equally  to  both  of  them,  and  also  why,  indeed,  so 
long  as  one  metal  is  produced,  so  must  be  the  other. 
Coupled  with  that  of  the  relative  cost  of  producing  them, 
as  ascertained  from  an  experience  of  several  centuries,  this 
fact  assures  us  not  only  that  15J  has  been  the  average  re- 
lation between  the  metals  in  the  past,  but  also  that  it  will 
remain  the  av^erage  relation  throughout  the  future. 

The  relation  being  thus  fixed,  there  are  powerful  influ- 
ences to  keep  it  there  and  prevent  it  from  yielding  to  any 
temporary  vicissitudes,  however  prolonged,  in  the  supply 
of  the  two  several  metals,  such,  for  example,  as  the  acci- 
dental finding  of  large  alluvial  deposits  or  placers  of  gold, 
as  in  the  early  history  of  California  and  Australia.  These 
influences  are,  first,  the  vast  stock  of  the  precious  metals 
already  in  existence  in  the  world ;  and  second,  the  steady- 
ins;  action  of  the  double  standard  in  the  countries  where 
it  prevails. 


67 

I  will  discuss  these  two  questions  in  the  order  named: 
First,  of: 

THE  world's  stock  OF  THE  PRECIOUS  METALS. 

Estimated  stock  of  the  precious  metals,  in  Coin,  Plate,  <fc.,  in  the 
World  at  or  about  the  various  periods  1803,  1848-'53,  and 
1872. 

Poriod.  Gold.  Silver.  Total. 

1803 11,800,000,000  ^3,200.000,000  $5,000,000,000 

1848-'53—     2,800,000,000     4,000,000,000     6,800,000,000 
1872 5,800,000,000     5,600,000,000  11,400,000,000 

Estbnated  stock  of  the  precious  metals  in  Coin  in  the  Occidental 
or  Commercial  loorld  at  or  about  the  various  periods  1803, 
1829-'39,  1848-'53,  and  1872. 

* 

Period.  Gold.  Silver.  Total. 

1803 $900,000,000  $900,000,000  $1,800,000,000 

1829-'39 800,000,000  1,000,000.000  1,800,000,000 

1848-'53 1,200,000,000  1.300,000,000  2,500,000,000 

1872 2,600,000,000  1,000,000,000  3,600,000,000 

Estimated  stock  of  the  precious  metals,  chiefly  silver,  in  Coin  in 
the  Oriental  or  transcommcreial  world  at  or  about  the  various 
periods  1803,  1829-39,  1848-'53,  and  1872. 

Period.  Stock  of  coin,  chieflj-  silver. 

1803 $700,000,000 

1829-'39 800,000,000 

1848-53 , 900,000,000 

1872 2,100,000,000 

The  above  data  are  derived  from  a  comparison  of  Er- 
nest Seyd,  Wolowski,  Jacob,  Newmarch,  Chevalier,  and 
McCulloch. 

INFLUENCE  OF  THE  STOCK  OF  THE  PRECIOUS  METALS. 

The  influence  of  this  stock  of  the  precious  metals  is  per- 
haps the  most  important  feature  of  this  whole  subject,  and 
yet,  so  far  as  I  am  aware,  it  has  either  wholly  escaped  no- 
tice or  been  referred  to  with  but  slight  appreciation  of  its 
consequence. 


GS 


STEADYING  ACTION  OF  THE  DOUBLE  STANDARD. 

The  second  great  influence  which  tends  to  keep  steady 
that  relation  of  15i>  to  1  which  the  commercial  brother- 
hood  of  the  world  and  the  conditions  of  the  production  of 
the  preciousmetals  have  primarily  occasioned,  is  the  steady- 
ing action  of  the  double  standard.  I  can  best  and  most 
briefly  exemplify  this  action  by  quoting  from  Professor 
Jevons: 

"  The  prices  of  commodities  do  not  follow  the  extreme 
fluctuations  of  value  of  both  metals  as  many  writers  have 
inconsistently  declared.  Prices  only  depend  upon  the 
course  of  the  metal  which  happens  to  have  sunk  in  value 
below  the  legal  rates  of  15|  to  1,  (or  wliatever  else  it  may 
be.)  ISTow,  if  in  the  accompanjqng  ligure  we  represent  by 
th^  line  A  the  variation  of  the  value  of  gold  as  estimated 
in  terms  of  some  third  commodity,  say  copper,  and  by  the 
Hue  B  the  corresponding  variations  of  the  value  of  silver, 
then  superposing  these  curves,  the  line  C  would  be  the 
curve  expressing  the  extreme  fluctuations  of  both  metals. 
Now,  the  standard  of  value  always  follows  the  metal  which 
falls  in  value,  hence  the  curve  D  really  shows  the  course  of 
variation  of  the  standard  of  value.  This  line  undergoes 
more  frequent  undulations  than  either  of  the  curves  of 
gold  or  silver,  but  the  fluctuations  do  not  proceed  to  so 
great  an  extent,  a  point  of  much  greater  importance."  (W. 
Stanley  Jevons  on  "  Money  and  the  Mechanism  of  Ex- 
change," N.  Y.  Appleton,  1875,  p.  138.) 


69 

The  effect  of  employiug  the  two  metals  together  is  to 
modify  the  action  of  each.  Such  dual  employment  pre- 
vents one  from  rising  and  the  other  from  falling,  so  that 
the  fluctuations  in  either  '*  do  not  proceed  to  so  great  an 
extent"  as  they  otherwise  would. 

GOLD  BY  ITSELF  NOT  A  COKRECT  MEASURE  OF  VALUE. 

Money  is  a  measure,  as  the  bushel,  the  rule,  and  the 
scale,  are  measures.  The  bushel  measures  capacity,  the 
rule  extension,  the  scale  gravity,  whilst  money  measures 
value.  All  of  these  measures  are  expensive;  expensive  to 
produce,  expensive  to  maintain,  expensive  to  preserve. 
ISTor  is  money  by  any  means  the  most  expensive,  it  being 
deemed  quite  susceptible  of  demonstration  that,  compared 
with  the  services  it  performs,  it  costs  even  less  than  the 
others.  Yet,  expensive  as  they  are,  their  use  must  never- 
theless be  a  source  of  economy  to  maukind,  or  they  would 
certainly  not  be  employed.  This  employment  and  the 
economy  to  which  it  is  due,  ceases,  the  moment  the  meas- 
ures fail  of  uniformity,  definiteness,  precision,  exactness, 
and  steadiness,  for  it  is  in  their  excellence  in  these  respects 
that  their  whole  utility  resides. 

The  discordance  of  moneys,  weights,  and  measures  has 
probably  been  in  all  ages  one  of  the  first  and  greatest  ob- 
stacles which  the  world's  commerce  had  to  overcome,  and 
even  the  progress  of  local  commerce  has  had  to  wait  upon 
uniformity  in  this  respect.  Indefinite  and  unprecise  meas- 
ures are  an  intolerable  evil  which  men  avoid  even  at  the 
expense  of  much  that  is  desirable. 

What,  then,  shall  be  said  of  measures  that  are  not  only 
discordant  and  unprecise,  but  fluctuating  also?  What 
would  be  said  of  a  bushel  that  alternately  contracted  and 
expanded,  and  contracted  more  than  it  expanded;  of  a  rule 
of  elastic  rubber,  or  a  pair  of  scales  with  a  shifting  ful- 
crum? And  what  shall  be  said  of  a  fluctuating  measure 
of  value  ? 

Yet  this  is  what  money  is,  if  gold  be  regarded  to  the 
exclusion  of  silver. 


70 

To  be  conviuced  of  this  it  is  only  necessary  to  consider 
the  statistics  of  the  precious  metals  which  have  just  been 
adduced. 

From  these  tables  it  will  be  observed  that  since  nearly 
the  beginning  of  the  present  century  the  stock  of  coin  in 
the  commercial  world  has  exactly  doubled,  that  is  to  say, 
it  has  increased  from  $1,800,000,000  to  $3,600,000,000,  an 
increase  that  very  closely  corresponds  with  population — the 
population  of  the  Occidental  world  having  been  180,000,000 
ill  1810  and  360,000,000  in  1875.*  Taking  both  of  the 
precious  metals  together,  the  stock  of  coin  has  been  as 
nearly  as  possible  §10  per  capita  of  population  at  each  of 
the  four  dates  mentioned  since  the  beginning  of  the  present 
century. 

At  these  periods  at  least,  and  we  have  the  data  for  no 
others,  the  measure  in  the  commercial  world  has  been 
apparently  unvarying,  and  this  appearance  has  deceived 
many  writers  on  the  subject;  but  it  is  by  no  means  true. 

The  effective  measure  of  value  is  not  the  whole  stock  of 
coin,  but  that  portion  of  it  which  the  law  permits  to  be  ten- 
dered for  the  payment  of  debts.  To  this  should  be  added  the 
paper  substitutes  which  are  from  time  to  time  temporarily 
employed  and  accepted  for  the  purpose  of  large  payments, 
and  which  fluctuate  in  volume  with  the  vicissitudes  of 
credit  and  the  adoption,  transitory  operation,  and  event- 
ual failure  of  legislative  expedients. f  The  balance  of  coin 
or  credit  no  more  form  a  part  of  the  measure  of  value  than 
do  the  precious  metals  when  locked  up  in  the  form  of 
plate.  i!Tow,  how  much  the  legal  tender  coin  and  substi- 
tutes of  the  commercial  world  amounted  to,  at  the  various 
dates  given,  is  difficult  to  estimate.  An  effort  in  this  direc- 
tion will,  however,  be  made. 

*  Essay  in  New  York  Independent,  March  11,  1875. 

t  If  legislation  were  wholly  removed  from  the  subject  of  money  except 
to  announce  and  fix  the  relation  of  the  metal?  from  time  to  time,  and 
generally  as  to  police  functions,  we  would  have  both  the  metals  in  circu- 
lation plus  an  amount  of  free  bank  paper,  which  would  bear  an  almost 
constant  relation  to  the  sum  of  the  metals.  The  measure  of  value  in 
such  case  would  be  easy  to  ascertain;  as  it  is,  nothing  is  more  difficult. 


71 

ESTIMATE  OF  THE  EFFECTIVE  MEASURE  OF  VALUE  IN  1803. 

Ill  1803,  either  the  siugle  silver,  or  the  double  standard 
prevailed  in  all  the  Occidental  countries  and,  except  in 
England,  where  gold  was  erroneously  overvalued  and  sil- 
ver deofraded,  it  was  fixed  in  those  countries  at  such  a 
relation  and  the  coinage  of  the  pieces  so  arranged  (I  do 
not  remember  having  heard  of  any  silver  piece  heavier 
than  that  of  two  G-erman  thalers)  as  to  permit  of  the  em- 
ployment of  nearly  the  whole  mass  of  silver  and  gold  coin 
then  in  the  Occident.  There  was  some  legal-tender  paper 
or  bank  paper  afloat,  notably  in  England  and  Russia, 
which  brought  the  whole  amount  up  to,  say  $2,000,000,000, 
with  a  ratio  of  activity,  let  us  assume,  of  1. 

ESTIMATE  OF  THE  EFFECTIVE  MEASURE  OF  VALUE  IN  1872. 

In  1872  a  single  gold  standard  existed  in  Great  Britain; 
a  restricted  double  standard  in  the  Latin  countries;  a  sin- 
gle silver  standard  in  other  European  countries;  a  disused 
double  standard  in  the  United  States  and  legal-tender 
paper  notes  in  many  of  these  countries.  The  sum  of  all 
these  currencies  might  amount  to  $-4,000,000,000,  with  a 
ratio  of  activity  of,  say  2,  making$8,000,000,000  in  1872,  with 
a  population  of  360,000,000,  or  $22  per  capita,  as  against 
$2,000,000,000  in  1803,  with  a  population  of  180,000,000,  or, 
$11  per  capita.  The  effective  measure  of  value  in  the  Occi- 
dental world  has,  therefore,  doubled,  since  the  beginning  of 
this  century. 

As  it  is  worth  while  to  ascertain,  if  possible,  how  we 
may  obtain  a  least  varying  measure  of  value  for  the  world 
it  becomes  necessary  for  this  purpose  to  turn  from  the 
statistics  of  the  Occidental  world  to  those  of  the  whole 
world. 

THE  world's  stock  OF  COIN  AND  POPULATION. 

Assuming  that  without  royal,  seigniorial,  or  legislative 
interference,  the  relation  of  the  mass  of  private  credit 
current  for  money,  to  the  mass  of  money,  would  be  con- 


72 


staut,  let  U8  confine  our  observation  to  the  stock  of  metal 
money  in  the  World.  In  1803,  with  a  population  of,  say 
900,000,000,  it  was  $2,500,000,000  ;  in  1829,  with  a  popu- 
hition  of,  say  1,000,000,000,  it  was  $2,600,000,000;  in 
1818-53,  with  a  population  of,  say  1,100,000,000,  it  was 
$3,100,000,000  ;  and  in  1872,  with  a  population  of,  say, 
1,200,000,000,*  it  was  $5,700,000,000. 

SWELLING  OF  THE  MEASURE  OF  VALUE  SINCE  1803. 

These  figures  give  an  average  of  coin  per  capita  throughout 
the  workr amounting  to  $2.83,  $2.60,  $3.09,  and  $4.75,  at 
the  respective  periods  named.  If  tlio  assumptions  of  popu- 
lation here  employed  are  admitted  to  be  even  approxim- 
ately correct,  then,  even  without  reckoning  the  greater 
activity  of  money  now  than  formerly,  it  would  follow  that 
there  has  been  no  more  fixedness  in  the  relation  of  the 
^Yorld's  coin  and  population  than  there  has  been  in  that 
of  the  efiiective  measure  of  value  and  population  of  the 
Occident.  They  have  both  doubled,  or  about  doubled, 
since  the  beginning  of  the  century— doubled  per  capita  of 
population.  The  coin  of  the  world  per  capita  and  the  effec- 
tive measure  of  value  of  the  Occident  per  capita  {i.  e.,  the 
coin  and  circulating  credit  of  the  Occident  combined)  have 
both  doubled. 

What  has  caused  this  doubling,  this  unsteadiness  of  the 
measure  of  value  ?  Has  it  been  due  to  diminution  in  the 
population  of  the  world  ?  No.  We  know  that  J:he  popu- 
lation of  the  Occidental  world  has  more  than  doubled 
since  the  beginning  of  the  century,  while  the  figures 
assumed  for  the  Oriental  world  exhibit  a  very  small 
increase. t 

*  BL'hm  and  Wagaer  sum  np  the  population  of  Mic  world  for  1872  at 
1,301,000,000,  but  in  this  tliey  include  China  at  -446,000,000.  There  is  no 
authority  for  this  extravagant  ligure  besides  tliat  of  the  Chinese  man- 
darin's communication  to  Lord  Macartney  in  170.>.  It  was  therein  stated 
Jit  333,000,000,  which  was  probably  excessive  by  more  than  one-half. 
(:;ousnlt  the  numerous  and  mucli  more  reliable  estimates  in  Malte-Brun's 
Geography. 

I  .Japan  increases  very  slightly.  As  to  India  and  Cliina,  they  are 
p  robably  stationary. 


73 

Has  it  been  due  to  superabundance  in  the  stock  of  silver? 
No.  That  stock  was  $1,600,000,000  in  1803  ;  .$1,800,000,- 
000  in  1829;  $2,200,000,000  in  1848,  and  $3,100,000,000 
in  1872.  Its  ratio  to  population  has  been,  as  the  ratio  of 
money  to  population  always  should  be,  a  slightly  increas- 
ing one;   bat  the  relation  has  been  substantially  constant. 

THE  MEASURE  OF  VALUE  SWOLLEN  BY  GOLD. 

The  swelling  of  the  measure  of  value  has  been  due  to  an 
enormous  increase  in  the  stock  of  gold.  This  amounted 
to  $1,800,000,000  in  1803,  and  twenty-six  years  afterwards 
it  had  not  increased.  .During  the  next  nineteen  years  it 
increased  50  per  cent.,  and  during  the  following  twenty- 
four  years  it  increased  116  per  cent,  over  the  previous 
increase.  In  1848  it  was  $1,200,000,000,  in  1872  it  was 
$2,600,000,000;  by  the  end  of  the  present  century  it  will 
probably  have  fallen  again  to  $2,200,000,000,  perhaps  to 
$2,000,000,000.  So  much  for  a  metal  which  depends  upon 
placer  mining  for  its  chief  supplies. 

This  is  the  steady  and  unvarying  measure  of  value  to 
which  the  advocates  of  the  single  gold  standard  would 
commit  us ! 

So  far  as  steadiness  is  concerned,  and  irrespective  of  all 
other  considerations,  gold  does  not  deserve  to  be  used  as 
money  at  all,  and  the  old  nations  of  Asia,  who  tried  this 
metal  more  than  thirty  centuries  ago,  appear  to  have  long 
since  come  to  this  conclusion ;  but  the  gradual  increase  of 
the  mass  of  silver  and  the  weight  of  the  coins,  together 
with  the  fact  that  gold  frequently  occurs  with  silver  in  the 
same  matrix,  give  a  place  to  gold  which  the  unsteadiness 
of  its  supply  would  otherwise  deny  to  it. 

ANNUAL  PRODUCTION  OF  GOLD  AND  SILVER  SEPARATELY. 

The  validity  of  the  statistics  which  have  been  quoted  rests 
upon  authorities — Wolowski,  Seyd,  Chevalier,  McCulloch, 
and  Jacob — whom  the  reading  world  has  thus  far  been 
satisfied  to  accept  as  safe  guides.     The  important  and  con- 


•74 

elusive  deductions  drawn  from  them  are,  however,  not 
without  an  amplitude  of  other  support.  Thej'  are  to  be 
drawn  also  from  the  statistics  of  the  annual  production  of 
the  precious  metals,  the  validity  of  which  will  admit  of  but 
little  question. 

Estimated  anmial production  of  the  precious  metals  througTioid  the  entire 
icorld  [exclusive  of  India,  China,  and  Japan  *)  at  various  periods  during 
the  nineteenth  century.     Sums  in  millions  of  dollars  and  tenths. 


Period.      Gold.        Silver.         Total.  Authority. 

ISOOf             -  3G.3  \  10  -?  J  I'liillip^- 

1801            13.0  -     J  •  \Birkmvre. 

1S29              5.0  20.0  2.5.0      Estimate  based  on  McCulloch-t 

1846§          29.2  32. .5  61.7      McCnlloch's  Die.  of  Commerce. 

1848            67.5  -  -          WestminsterEeview,  Jan.,  1876. 

18.5011          93.2  43.9  137.1      McCulloch. 

1851  120.0  -  -  Westminster  Review,  .Jan.,  1876. 

1852  182.5  40.5  223.0      Joura.de3Economistes,Mar'76. 

1852  193.7  -  -  WestminsterEeview.  Jan.,  1876. 

1853  155.0  40.5  195.5      Journal  des  Economistes. 

1853  -  -  160.0      Blake. 

1854  -  47.4  -  Wliitney,    by    countries,   App. 

Cycl.,  XV,  53,  new  edition. 

*No  mines  in  India.  (McCulloch  in  Encyc.  Biit.  Ed.,  1858,  p.  470.)  Gold  mines  in 
China,  but  not  worked  (-172)  for  the  reason,  according  to  Sir  R.  Murehison,  that  il  would 
conflict  with  Chinese  theory  relative  to  maintaining  "balance  of  the  circulating  med- 
ium." Otre.<;ehoflF  estimated  total  yield  of  precious  metals  in  China,  India,  Japan,  &c., 
in  1854  at  $30.00i),000  a.  year,  but  this  is  evidently  too  high.  Whitney  estimates  the  gold 
product  of  all  Southern  Asia  at  $000.1)00  a  year.  Perhaps,  in  view  of  Newmarch's  state- 
ment, (Tooke,  vi,  723,)  that  the  specie  (coin,  trinkets,  &c..)  in  India  amounts  to  £400,- 
000,000.  of  which  say  one-half  is  in  coin,  and  aliowiug  same  for  China  and  Japan,  total 
coin  in  Southern  .\s"ia  S2,O0o,000,OOO— the  total  product  of  Southern  Asia  may  be  approx- 
imately as  follows:  Silver  2'.i,  gold  1,  total  30.  Allowing  one  and  a  half  per  cent,  per 
annum  for  wear  and  loss  of  coin,  it  would  require  at  least  this  amount  to  keep  up  tlie 
stock,  while  European  and  .\merican  supplies  would  be  needed  for  the  arts  and  to 
make  provision  for  increasing  population.  Adding  these  sums  to  the  above  estimate 
for  1874  we  have  the  following  grand  total  annual  production  for  the  entire  world — 
sums  in  millions  of  dollars  : 

1874.  Gold.  Silver.  Total. 

The  world  exclusive  of  Southern  A.sia 90.5  71.5  1G2.0 

Southern  Asia 1.0  29.0  30.0 

91.5  100.5  192.0 

t  Estimated  by  Raymond  (Rep.  of  1S75)  15  gold  and  40  silver:  but  this  estimate,  though 
not  very  wide  of  tlie  murk,  is  without  authority.     Phillips  gives  details  by  countries. 

J  McCulloch  states  (and  in  this  he  agrees  with  all  other  authors)  that  the  lowest  point 
of  production  was  reached  in  1829.  He  states  that  Mexico  and  South  America  together 
only  produced  of  both  metals  $20,000,000,  chiefly  silver,  and  that  very  little  was  else- 
where produced.  Allowing  $5,000, OiO  for  what  was  elsewhere  produced,  crediting  tliat 
$5,000,000  to  silver  and  allowing  one-fourth  of  the  American  product  to  have  been  in 
gold,  (which  exceeds  the  proportion  estimated  by  Jacob  for  the  same  period,)  I  accord 
to  silver  $20,000,000  and  to  gold  35,o00^oOO. 

g  Estimated  by  Raymond  at  43  gold  and  39  silver;  but  wide  of  the  mark  and  without 
authority.     Birkmyre  gives  details  by  countries  for  31.5  silver. 

II  For  about  this  date  DeBow,  ii,  558^  gives  $131,.50O,OO0,  gold  and  silver,  as  follows: 

California £14,500,000 

Brazil ; 7,000.000 

Russia : 3,350,000 

Great  Britain  (silver) .5i).ooo 

Asia I,40o,oo0 

8131,500,000 £20,300,000 

Phillips  gives  details  for  43.8  silver.    (App.  Cyc.  sv,  53.) 


75 


Estimated  annual  production^  SfC — Continued. 

'^eriod. 

Gold. 

Silver. 

Total. 

Autliority. 

1854 

127.0 

40.5 

167.5 

Journal  des  Economistes. 

1855 

135.0 

40.5 

175.5 

Ibid. 

1856 

147.5 

40.5 

188.0 

Ibid. 

18.57 

133.0 

40.5 

173.5 

Ibid. 

1857 

- 

— 

195.0 

McCulloch. 

1858 

124.5 

40.5 

165.0 

Journal  des  Economistes. 

1859 

124.5 

40.5 

165.0 

Ibid. 

1860 

119.0 

40.5 

159.5 

Ibid. 

1861 

114.0 

42.5 

156.5 

Ibid. 

1861 

_ 

56.0 

— 

Soetbeer. 

1862 

107.5 

45.0 

1.52.5 

Journal  des  Economistes. 

1863 

107.0 

49.0 

156.0 

Ibid. 

1864 

113.0 

51.5 

164.5 

Ibid. 

1865 

120.0 

52.0 

172.0 

Ibid. 

1865 

130.7 

62.3 

193.0 

Blake  for  sold,  1867;  Phillips 
for  silver,  1865. 

1866 

121.0 

50.5 

171.5 

Journal  des  Economistes. 

1867 

— 

53.8 

— 

Blake,  by  countries,  App.  Cyc, 
XV,  53,  new  edition. 

1867 

116.0 

54.0 

170.0 

Journal  des  Economistes. 

1868 

120.0 

50.0 

170.0 

Ibid. 

1869 

121.0 

47.5 

168.5 

Ibid. 

1870 

116.0 

51.5 

167.5 

Ibid. 

1871 

116.5 

61.0 

177.5 

Ibid. 

1872 

101.5 

65.0 

166.5 

Ibid. 

1873 

103.5 

70.0 

173.5 

H>id. 

1873 

103.5 

76.3 

179.8 

Ibid,  for  o-old,  App.  Cyc.  forsilv. 

1874 

90.5 

71.5 

162.0 

.lournal  des  Economistes. 

1875 

97.5 

62.0 

159.5 

Ibid. 

1875 

118.0 

72.0 

190.0 

Estimate.* 

Taking  silver  by  itself,  we  find  that  the  annual  prodac- 
tion  of  the  Occidental  world  has  bat  little  more  than 
kept  pace  with  population.  It  was  ^35,000,000  a  year  at 
about  the  beginning  of  the  century;  it  was  172,000,000 
a  year  in  1875.  The  statistics  of  its  annual  production 
are  characterized  by  the  same  steadiness  that  distinguishes 
its  place  in  the  circulation.  If  gentlemen  want  details 
they  can  have  them  country  by  country.  There  is  no  guess 
work  here;  we  are  standing  upon  solid  rock. 

Turning  to  gold  we  tind  that  the  aimual  production  has 
varied  enormously.  It  was  $13,000,000  a  year  in  1801;  fell 
to  perhaps  not  over  $5,000,000  in  1829;  rose  to  ^182,- 
500,000  in  1852;    fell  to  $107,000,000  in  1863;    rose   to 


*The  French  estimate  is  con^idereil  to  1)8  at  least  Sin,000,ono  too  low  for  silver. 
Silver  ia  the  United  States  I'or  ISTo  was  S-i.Oi)u,0(X»  more  than  in  186S.  The  French  esti- 
mate is  also  believed  to  bj  too  low  I'or  gold. 


76 

$130,000,000  in  1865,  and  fell  to  ^97,500,000  in  1875,  and 
with  a  downward  tendency. 

And  yet  this  wildly  fluctuating,  ruinonsly  unsteady  metal 
is  what  the  fledglings  of  political  economy,  the  charlatans 
of  monetary  conventions,  and  the  numerous  other  dupes  of 
Lombard  street  would  divorce  from  its  natural  complement, 
silver,  and  have  for  a  sole  standard  of  value.  As  well 
have  the  rack  for  a  measure.  It  has  often  served  that 
purpose,  only  the  thing  that  it  measured  was  not  value, 
but  human  endurance,  and  that  seems  to  be  about  all  that 
gold  by  itself  is  capable  of  measuring.  Thirteen  million 
dollars  a  year  in  1801;  $5,000,000  in  1829;  $182,000,000 
in  1852 ;  $97,500,000  in  1875 ;  a  wonderful  measure  of  value 
indeed ! 

Let  us  suppose  for  a  moment  that  silver  had  been  de- 
monetized by  the  entire  commercial  world  at  the  same 
time  that  England  demonetized  it,  to  wit,  in  1816,  and 
the  commerce,  the  business,  and  the  vested  interests,  the 
daily  labor  and  the  time  contracts  of  society,  left  to  adjust 
themselves  in  the  course  of  twenty-six  years  (from  1803  to 
1829)  from  a  measure  of  $1,800,000,000  of  gold  and  silver 
coin,  to  one  of,  say,  $700,000,000  or  $800,000,000  of  gold 
coin !  Recollect  that  even  as  it  was,  the  whole  of  that  period 
was  one  of  bankruptcies  and  convulsions.  Now,  let  me  ask 
w^hat  it  would  have  been,  had  the  evil  been  aggravated  by 
the  adoption  of  such  a  gigantic  blunder  as  England  set  up 
in  1816  for  the  imitation  of  mankind? 

We  are  upon  the  eve  of  another  era  of  the  same  char- 
acter. The  annual  supply  of  gold  has  reached  its  cul- 
mination. The  supplies  of  gold  are  falling  oft".  The  river 
beds  of  California  and  Australia  have  been  washed;  the 
surface  gold  has  been  secured ;  the  quartz  mines  have 
measuredly  used  up  the  paying  ore;  the  water-line  has 
been  touched,  and  below  it  are  only  those  sulphurets  which 
as  yet  have  not  been  successfully  treated.  Beware  foreign 
influence!  Beware  the  example  of  England!  Beware 
England's  fatal  blunder  of  1816 !  Beware  the  ruinous 
eflects  that  followed  close  upon  its  heels !     The  causes  of 


77 

the  bankruptcies  of  1873,  187-4,  1875,  and  1876  may  lie  in 
deeper  waters  than  the  shallow  stream  which  commenced 
to  flow  in  October,  1873.  They  may  lie  in  the  shrinkage 
of  ofold — that  o-old  which  the  ill-considered  act  of  1873 
made  the  sole  measure  of  values  and  the  sole  arbiter  of 
fortunes  in  the  United  States. 

For  the  purpose  of  testing  by  comparison  the  efficienc}* 
of- gold  as  a  measure  of  values,  let  us  suppose  again  that 
gold  was  the  sole  legal  tender  money  of  the  commercial 
world  in  1848.  Will  gentlemen  attempt  to  deny  that  the 
stock  of  this  metal  in  the  coins  of  the  commercial  world 
more  than  doubled  between  that  date  and  1807  ?  If  this 
fact  be  admitted,  must  it  not  be  perceived  that,  with  gold 
as  the  sole  standard  of  value,  prices  would  have  more  than 
doubled  during  the  course  of  these  nineteen  years,  and 
that  with  such  a  great  and  sudden  enhancement  of  prices 
the  worth  of  all  vested  ititerests,  the  relations  of  all  con- 
tracts, the  entire  distribution  of  wealth,  would  have  been 
seriously  aflected  ?  The  widow  and  the  orphan,  left  with  a 
comfortable  competence  in  1848,  might  have  had  to  eke  out 
a  scanty  living  in  1867  ;  the  lessor  of  1848  might  have  been 
glad  to  abandon  his  property  rather  than  pay  the  taxes 
and  charges  of  1867;  the  rich  would  have  become  unde- 
servedly poor,  and  the  poor  undeservedly  rich — a  very  equi- 
table arrangement,  according  to  some  minds,  and  I  confess 
I  am  not  wholly  unbiased  that  way  myself;  but  I  do  not 
forget  that  I  am  now  addressing  the  oflicial  successors  of 
the  authors  of  the  act  of  1873. 

Observe,  too,  the  effect  which  the  enormous  folly  of 
demonetizing  silver  in  certain  States  of  Europe  and  in 
the  United  States  has  had  upon  the  currency  of  Asia.  If 
these  statistics  have  even  approximate  worth,  and  there 
is  no  reason  to  subject  them  to  the  slightest  suspicion  of 
incorrectness,  for  they  rest  upon  numerous  authorities 
who  derived  their  data  from  widely-different  sources,  it 
will  be  seen  that  the  currency  of  Asia  has  more  than 
doubled  since  1848,  and  probably  chiefly  since  1862.  This 
currency  is  estimated  to  have  amounted  to  ^700,000,000 


78 

in  1803,  $900,000,000  in  1848,  and  $2,100,000,000  in  1872, 
chiefly  in  silver.  So  far  as  we  know,  and  are  led  to  believe, 
from  the  character  and  institutions  of  the  peoples  of  these 
eountries,  there  was  little  or  no  increase  at  all  in  their 
numbers  up  to  1862,  if,  indeed,  there  has  been  an}''  since 
that  date.  The  increase  of  their  circulatinsr  medium  has, 
therefore,  been  almost  absolute,  and  it  must  have  had  the 
effect  of  enhancing  the  present  level  of  prices  in  those 
countries  three  times  more  than  that  of  1803. 

No  wonder  that  Mr.  Secretary  Bristow  advises  Congress 
that  the  abolition  of  our  import  duty  upon  tea  has  failed 
to  cheapen  the  price  of  that  article.  Wh}^  we  should  have 
contributed,  as  we  did  contribute,  by  the  suspension  act 
of  1862  and  the  demonetization  act  of  1873,  to  triple  the 
specie  prices  of  everything  we  have  had,  and  shall  have, 
to  buy,  from  'China,  Japan,  and  the  East  Indies,  wholly 
suq^asses  the  understanding.  To  men  of  plain  minds  it 
seems  to  have  been  the  most  stupendous  folly. 

APOLOGIES  FOR  SUBSIDIARY  COINAGE. 

To  these  grave  charges  about  tripling  prices  in  Asia 
there  has  been  a  weak  and  ill-considered  reply,  to  the 
effect  that  while  Em^-land  and  her  subservient  imitators 
on  the  continent  of  Europe  and  in  this  country  have 
demonetized  silver,  as  a  legal  tender  for  the  payment  of 
debts,  that  metal  has,  nevertheless,  been  allowed  to  re- 
main in  the  form  of  base  coin  for  fractional  currency  or 
small  change.  It  seems  to  have  been  forgotten  that  base 
or  token  money  can  onlj'  circulate  to  a  small  amount. 
For  example,  if  gold  and  silver  were  now  equally  legal 
tender  in  Great  Britain,  as  they  were  previous  to  1717,  a 
large  proportion,  perhaps  one-half,  of  the  whole  amount  of 
money  now  in  the  kingdom,  which  is  estimated  at  $575,- 
000,000,  (plus  ^5,000,000  of  copper,)  would  be  of  silver, 
which,  at  the  present  moment,  is  the  cheaper  metal,  at  the 
relation  of  \h\.  In  France,  in  1860,  where  the  double 
standard  prevailed,  and  when  gold  was  the  cheaper  metal  ^ 
at  the  legal  relation  of  15^,  a  large  portion  of  the  entire 


79 

metallic  currency  was  of  gold,*  But  instead  of  the  cur- 
rency of  England  being  entirely  of  silver,  at  the  present 
time  there  are  in  that  country  $500,000,000  of  gold  and 
only  $75,000,000  of  silver  (tokens)  in  circulation.!  This 
result  is  due  to  the  demonetization  of  silver,  and  from  this 
cause  some  $200,000,000  of  silver,  which  woukl  otherwise 
hold  place  in  the  money  of  that  country,  have  either  been 
melted  up  or  exported;  reduced  either  to  plate  or  shipped 
to  Asia;  in  the  one  case  lost  almost  irretrievably  to  civil- 
ization, so  far  as  its  agency  in  measuring  values  and 
stimulating  industry  is  concerned;  in  the  other  gone  to 
help  add  to  the  strength  and  commercial  resources  of  a 
semi-barbarous  world. 

But  far  more  important  than  this  is  the  consideration 
that  the  substance  of  which  coins  are  made  and  the  sub- 
stance of  which  the  standard  is  composed  are  altogether 
different  matters.  The  coins  of  a  country  may  be  made 
of  gold  or  silver ;  yet  if  wheat  were  made  the  standard 
of  value,  that  is  to  say,  if  the  coins  were  payable  on  demand 
in  wheat,  the  prices  of  other  commodities  would  fluctuate 
not  with  the  vicissitudes  of  coinage  nor  even  of  the  stock 
and  production  of  the  precious  metals,  but  with  those  of 
the  stock  and  production  of  wheat.  Coins  of  this  charac- 
ter would  merely  be  tokens,  promises  to  pay  (wheat) 
stamped  on  gold  or  silver;  of  tliis  character  are  the  silver 
coins  of  England,  and  the  silver  half  dollars,  quarters,  and 
dimes  of  the  United  States.  They  are  mere  tokens,  and, 
except  at  times  when  they  rose  in  value  (in  the  standard) 
60  as  to  be  worth  melting  or  exporting,  the  metal  of  which 
they  were  composed  would  pi-actically  be  demonetized. 

SUBSIDIARY  COINAGE  NOT  WHAT  IS  WANTED. 

It  is  not  merely  urged  by  the  advocates  of  the  double 
standard  that  silver  should  have  that  subordinate  place  in 
the  currency  which  is  the  utmost  that  can  be  filled  by  a  token 
coinage,  and  which  could  be  filled  to  a  certain  extent  as  well 

*Seycl.  tJevons. 


80 

by  any  baser  metal  or  even  perhaps  by  paper;  it  is  not 
merely  asked  that  silver  shall  be  granted  the  same  sort  of 
reeoo-nition  that  is  vouchsafed  in  social  life  to  a  menial;  it 
is  demanded  that  it  shall  be  accorded  the  same  rank  in 
which  gold  has  been  maintained ;  the  rank  to  which  the 
great  place  of  silver  in  the  coins  of  the  world,  its  universal 
distribution  and  appreciation,  its  ample  and  steady  supply, 
its  twin-birth,  its  utility  and  adaptability,  and  its  worth  as 
a  measure  of  value,  entitle  it.  With  a  double  standard 
wisely  fixed,  all  the  moderately  large  payments  would  be 
made  in  gold  and  all  the  smaller  ones  in  silver,  just  as  for 
moderately  large  quantities  of  liquids  the  oaken  hogshead 
is  employed,  and  for  smaller  ones,  the  tin  gallon.  By 
forcibly  interdicting  oak  you  might  compel  hogsheads  to  be 
measured  by  the  tin  gallon,  just  as  by  interdicting  tin  you 
might  force  gallons  to  be  measured  by  the  oaken  hogs- 
head. What  is  demanded  for  silver  is  that  it  shall  be 
left  free  to  assume  its  own  rank  in  the  currency,  so  that 
whenever  it  temporarily  becomes  the  cheaper  metal  at  the 
average  relation  to  gold,  it  may  for  the  time  possess  that  same 
influence  in  modifying  the  measure  of  value  that  has  been 
always  so  zealously  accorded  to  it  when  it  became  the 
dearer. 

THE  FLUCTUATIONS   IN   GOLD  DUE  CHIEFLY  TO  PLACER    MINING. 

It  will  not  do  to  rejoin  to  this  that  the  probabilities  of 
gold  again  becoming  the  metal  in  more  plentiful  supply, 
are  remote.  Even  if  true,  this  reply  would  confess  the 
very  selfishness  of  the  champions  of  the  gold  standard 
which  they  have  been  so  solicitious  to  conceal  in  the  solem- 
nity of  their  monetary  conventions  and  the  surreptitious 
character  of  their  measures  of  legislation.  But  it  is  not 
true.  Although  at  the  present  time  the  annual  supplies  of 
gold  are  falling  off,  it  is  iiTipossible  to  predict  how  long 
this  movement  may  last.  While  silver  is  essentially  the 
product  of  industry  and  enterprise,  gold  is  largely  that  of 
adventure  and  chance.  This  results  from  the  physical  fact 
that  the  last  named  metal  is  nearly  always  found  in  allu- 


81 

vial  deposits  or  placers,  and  it  is  from  these  sources  that 
the  bulk  of  the  world's  stock  of  gold  has  been  obtained  ; 
this  is  never  the  case  with  silver. 

aOLD  AT  PRESENT  CHIEFLY  A  BRITISH  PRODUCT. 

These  facts  bring  under  our  consideration  another  im- 
portant matter  in  connection  with  the  history  of  the  pre- 
cious metals  separately.  It  is  this:  that  at  the  present  time 
and  for  the  main  part  the  supplies  of  gold  to  the  world  are 
chieiiy  from  British  countries  or  countries  subject  to  Brit- 
ish domination.  The  followinir  table  will  illustrate  this 
very  significant  statement : 


& 


Estimated  annual  gold  yrodact  of  the  world  at  latest  dates  for 
which  the  statistics  are  attainable  in  the  various  official  reports. 

The  United  States,  1875 §26,000,000 

Australia,  etc.,  1872 $58,000,000 

British  Columbia 2,000,000 

Canada  and  Nova  Scotia 500,000 

Other  British  Possessions  and 
British  isles 1,500,000 

Total  British  Possessions 62,000,000 

Balance  of  the  world 30,000,000 

Total  world $118,000,000 

Proportion  of  the  world's  production  from 

British  Possessions  (per  cent) 52|^ 

From  this  table  it  will  be  observed  that  of  the  $118,000,- 
000,  which  represent  the  annual  gold  product  of  the  world 
521  per  cent,  -y^ras  obtained  in  countries  over  which  the  Brit- 
ish flag  waved  or  which  were  subject  to  British  domination. 

Is  this,  then,  the  secret  of  British  plutocratical  solicitude 
for  the  single  gold  standard  ?  Is  it  not  only  that  the  peo- 
ple of  Great  Britain  shall  have  the  rewards  of  their  labor 
measured  by  this  diminishing  measure,  which  is  to  be  held 
tightly  grasped  in  the  monopolizing  and  cruel  hands  of 
their  plutocratic  lords,  but  that  the  labor  of  the  entire  civil- 
ized world  shall  be  measured  by  it  also?  For  one,  I  reply 
6 


82 

to  this,  never  !  And  when  this  subject  shall  be  fully  under- 
stood by  the  American  people,  the  reply  that  I  now  make 
should  echo  and  reverberate  throughout  the  whole  length 
and  breadth  of  this  great  land.  Never  ought  we,  never 
will  we,  submit  to  have  our  labor  and  enterprise  measured 
by  a  standard  subject  to  the  manipulation  and  pleasure  of 
a  foreign  nation,  and  of  a  class  hostile  to  the  genius  of  our 
institutions. 

THE  DOUBLE  STANDARD  FOR  THE  UNITED  STATES. 

Hitherto  the  double  standard  has  been  alluded  to  with 
reference  to  its  great  superiority  as  a  measure  of  value  for 
the  exchanges  of  the  world.  I  now  propose  to  treat  it 
solely  or  chiefly  with  reference  to  the  aflairs  of  the  United 
States. 

Many  of  the  considerations  adverted  to  in  connection 
with  its  superiority  as  a  measure  of  value  for  all  nations 
apply  with  equal,  and  sometimes  more  than  equal,  force  to 
this  nation.  Briefly  recapitulated  they  are  mainly  as  fol- 
lows: 

The  convenience  of  employing  gold  for  moderately  large 
payments  and  of  silver  for  smaller  ones  induces  both  metals 
to  be  employed  as  money,  whether  one  or  the  other,  or 
both  or  neither,  are  made  the  standard  of  value.  The  vio- 
lent aberrations  in  the  annual  supplies  of  gold,  the  steadi- 
ness of  silver,  the  often  deficient  and  sometimes  exce>sive 
supplies  of  the  one,  and  the  always  ample  supplies  of  the 
other,  forbid  us  to  rely  upon  one  as  a  standard  of  value  to 
the  exclusion  of  the  other,  and  particularly  when  that  one 
is  gold.  And  this  objection  to  gold  as  the  sole  standard 
of  value  obtains  additional  force  at  a  time  like  the  present, 
when  its  annual  supply  is  diminishing  every  year,  it-s  dis- 
tribution throughout  the  world  is  narrowing,  and  its  pro- 
duction is  at  the  mercy  of  the  arms  and  legislation  of  a 
single  powerful  nation  and  a  class  hostile  to  the  growth 
and  prosperity  of  republican  communities. 

Another  basic  consideration  is  the  stock  of  precious 


83 

metals  in  possession  of  the  world,  the  product  of  many 
centuries  of  toil,  abstinence,  contention,  suffering,  and 
sacriiice.  It  is  this  stock  which  measures  prices.  Xearly 
one-half  of  it  consists  of  silver.  To  demonetize  this  half 
will  reduce  all  prices  one-half  and  convulse  every  country 
in  the  world,  except  those  which  may  refuse  to  take  part 
in  such  demonetization. 

Beyond  these  considerations,  however,  there  are  others 
which  apply  with  peculiar  force  to  the  present  time  and  to 
our  own  country.  These  will  be  treated  in  their  proper 
order. 

EFFECTS  UPON  THE  DEBTOR  AND  CREDITOR  CLASSES. 

First,  with  regard  to  the  effect  of  the  standard  on  the 
debtor  and  creditor  classes. 

At  the  outset,  let  it  be  premised  to  the  great  honor  and 
glory  of  our  country  that,  in  the  sense  in  which  the  term 
is  used  in  England,  we  have  no  debtor  and  creditor  classes. 
Notwithstanding  the  tendency  of  the  national  debt  and  of 
the  other  financial  scars  which  the  recent  great  civil  con- 
flict has  left  upon  the  war-worn  features  of  the  nation,  we 
have  no  permanent  debtors  and  creditors.     The  man  who 
is  a  debtor  to-day  becomes  a  creditor  to-morrow,  and  the 
creditor  of  to-morrow  becomes  the  debtor  of  next  day  after 
to-morrow.     We  are  all  in  the  same  boat  in  this  country  : 
all  struggling,  toiling,  risking,  winning,  or  losing.     There 
are  no  hereditary  privileges,  no  entailed  estates,  no  perma- 
nently vested  interests.     Misadventure,  death,  unexpected 
legislation,  in  a  word,  a  thousand  agencies,  are  continually 
at  work  to  redistribute  wealth  and  redistribute  poverty; 
whilst  a  free  soil,  boundless  natural  resources,  thoroughly 
diffused  and  abundant  education,  and  a  universal  spirit  of 
enterprise,  contribute  to  increase  our  stock  of  wealth;  so 
that  while  the  gifts  of  fortune  are  being  continually  redis- 
tributed, those  of  intelligence  and  industry,  which   are 
always  fairly  distributed  at  the  outset,  are  being  added  to 
them — an  equalizing  reservoir  with   an  already  equalized 
and  always  rising  level. 


84 

Therefore,  the  remarks  which  will  now  be  devoted  to  the 
consideration  of  the  respective  equities  of  the  debtor  and 
creditor  classes  will  apply  with  far  less  cogency  to  the 
afiairs  of  this  country  than  to  those  of  any  other. 

It  was  not  complained  by  the  debtor  class,  when  the  act 
of  1873  was  passed,  that  it  would  tend  to  favor  the  interests 
of  the  creditor  class,  as  it  undoubtedly  did.  Why  was  no 
complaint  made?  Because  the  act  was  so  drawn  that  it 
apparently  related  only  to  the  technical  regulation  of  the 
mints,  and  gave  no  notice,  either  from  its  title  or  its  text 
that  that  far  graver  measure — a  change  of  the  standard  of 
value — was  proposed.  There  is  no  mention  of  the  term 
"  standard  of  value  "  in  the  act;  there  is  not  even  mention 
made  of  tlie  silver  legal  tender  dollar  which  the  act  abol- 
ished. ISToue  but  those  fully  conversant  with  the  history 
of  our  legislation  upon  the  subject  of  money,  none  but 
those  who  were  familiar  with  the  details  and  principles  of 
the  long-forgotten  act  of  1792  and  subsequent  legislation, 
could  have  understood  the  full  purport  of  the  important 
changes  of  legislation  which  the  passage  of  the  act  of 
1873  involved. 

Moreover,  specie  payments  had  been  suspended  for 
eleven  years,  nor,  for  more  than  two  years  aftervyard,  was 
there  any  provision  made  for  resumption,  and  resump- 
tion appeared  so  far  off  in  1872,  that  is  to  say,  at  the 
time  the  Demonetization  Act  was  introduced  into  Con- 
gress, that  the  effects  of  demonetization,  coupled  with 
those  of  resumption,  were  not  realized  or  anticipated. 
The  silver  dollar  had  not  been  coined  at  our  mints  for 
many  years,  and  during  the  fall  of  gold  subsequent  to 
1848  had  gone  out  of  circulation,  except  for  the  payment 
of  ground-rents  in  Philadelphia  and  elsewhere,  and  for 
the  purposes  of  the  Asiatic  trade.  The  demonetization  o^ 
the  silver  dollar  at  such  a  period  was,  like  a  stab  in  the 
dark,  unexpected,  unseen,  and  not  to  be  felt  until  too  late 
to  be  averted. 

There  was,  therefore,  no  notice  to  the  debtor  class,  who 
are  always  the  poorer  class,  and,  therefore,  the  more  uu- 


85 

merous  and  widespread,  the  least  organized,  the  least  pro- 
tected by  the  law,  the  least  courted  by  ambition  or  favored 
by  power. 

In  the  absence  of  such  complaint  from  the  debtors  in 
1873,  in  the  absence  of  any  notice  which  was  practically 
accessible  to  them  of  the  supernal  importance  of  the  change 
proposed,  what  right  would  now  the  creditor  class  possess 
to  object  to  the  rehabilitation  and  restoration  of  the  double 
standard  ?     Clearly  none  whatever. 

I  do  not  speak  now  of  the  creditors  of  the  Government, 
whose  status  in  respect  of  the  coin  in  which  their  claims  are 
to  be  paid  is  not  proposed  to  be  discussed;  I  speak  of  cred- 
itors generally.  In  view  of  the  concealed  effects  of  the  de- 
monetization act  of  1873,  in  view  of  the  fact  that  resump- 
tion was  not  provided  for  until  1875,  in  view  of  the  utter 
absence  of  complaint  from  the  debtor  class  when  the  demon- 
etization act  was  passed,  what  right  or  even  shadow  of 
right  has  any  class  of  creditors  now  to  object  to  the  mone- 
tization  of  the  silver  dollar  ?  The  Demonetization  Act  was 
not  passed  at  their  solicitation  any  more  than  it  was  passed 
with  the  knowledge  or  concurrence  of  the  debtors.  It  was 
not  a  contract  between  the  Government  and  the  people. 
It  was  a  mere  caprice  of  legislation,  which  could  be  undone, 
which,  in  deference  to  public  policy  and  justice,  should  be 
undone,  and  which,  under  our  organic  law,  which,  as  I 
hope  presently  to  show,  raises  the  double  standard  far 
above  the  province  of  legislation,  must  be  undone. 

But  putting  all  this  aside  and  looking  at  the  question 
purely  as  an  economical  and  political  one,  and  without 
reference  either  to  its  merits  or  its  history,  both  of  which 
80  emphatically  decide  in  favor  of  the  double  standard,  let 
us  see  which  class  it  is  that,  when  benefits  or  advantages 
are  to  be  dispensed,  a  wise  and  particularly  a  republican 
Government  should  favor. 

Is  it  the  creditor  class,  who  consist  to  some  extent  of 
capitalists  whose  estates  were  hereditary,  of  others  whose 
estates  were  the  result  of  chance,  unexpected  death, 
unlooked-for  legislation, or  extraordinary  and  unforeseeable 


86 

events?  Is  it  the  creditor  class,  whose  garnered  capital  rep- 
resents the  results  of  past  labor,  perhaps  of  that  of  the 
serf,  the  slave,  the  overworked,  browbeaten,  fagged  and 
famished  victim  of  toil  ?  Is  it  the  creditor  class,  who  are 
always  allied  to  an  effete  conservatism,  out  of  which 
spring  caste  and  aristocracy  and  feudal  privileges  and 
every  other  odious  form  of  power,  to  whom  legislative 
favors  shall  be  granted?  Is  it  the  creditor  class,  who  least 
stand  in  need  of  such  favors  or  advantages  ? 

To  whom  shall  legislation  dispense  what  small  favors  it 
may  have  to  bestow  in  a  country  so  free  and  republican  as 
this?  Shall  it  be  to  the  class  whose  tendencies  I  have 
depicted  or  to  the  debtor  class,  to  the  poor,  the  needy,  the 
temporarily  depressed,  the  cast-down,  the  struggling,  the 
toiling,  the  enterprising,  the  active,  the  aspiring,  the  ever 
hopeful  ? 

Shall  the  favors  of  legislation  be  granted  to  those  who 
ask  for  them  and  fawn  and  intrigue  for  them,  or  to  those 
who  never  ask,  nor  fawn,  nor  intrigue?    ■ 

Shall  they  be  granted  to  those  whom  we  here  in 
Congress  do  not  represent,  or  to  those  whom  we  do  ? 

Shall  they  be  awarded  to  the  many  whose  servants  we 
are,  or  to  the  few^  whose  servants  we  are  not?  For  re- 
member that  this  is  a  Government  based  upon  numbers 
and  not  upon  wealth,  and  that  the  States  and  Common- 
wealths which  are  represented  in  this  Chamber  are  also 
based  upon  the  principle  of  numbers,  of  the  greatest  good 
to  the  greatest  number. 

If  there  are  favors  to  be  accorded,  let  the  People  have 
them.      It  is  upon  their^  prosperity  and  welfare  that  this 
country,  nay  the  entire  world,  essentially  depends  for  its , 
advancement;  not  upon  the  patronage  of  a  class. 

NO  ADVANTAGES  TO   BE  GAINED   BY  EITHER  CLASS. 

But  I  deny  that  there  are  any  favors  or  advantages  to  be 
granted  by  a  ic;turn  to  the  double  standard.  A  single 
standard  confers  advantages,  advantages  to  the  few,  whilst 


87 

a  double  standard  divides  and  distributes  advantages.  This 
is  fully  illustrated  by  Professor  Jevon's  diagram.  The 
double  standard  both  gives  and  takes.  It  strikes  a  me- 
dium between  the  metals,  although  but  one  of  them  may 
chiefly  be  employed  in  the  currency,  and  that,  the  one  of 
temporarily  the  lesser  purchasing  power.  There  is  no 
practical  difference  between  its  effects  and  those  which 
would  flow  from  the  adoption  of  a  single  metal  which  is  ad- 
hered to  as  the  standard  forever,  a  metal  which  is  always 
in  as  sufficient  supply,  and  as  widely  distributed  and  largely 
hold  as  now  are  both  the  metals  combined,  provided  such 
a  metal  could  be  found.  And  whatever  iufinitessimally 
small  difference  there  is,  whatever  poor  crumb  of  advan- 
tasre  the  restoration  of  the  double  standard  would  afford 
to  the  debtor  class,  it  bears  no  comparison  at  all  with  the 
full  ration,  the  stuffed  loaf  of  advantage  which  the  contin- 
uation of  the  sinsj-le  o^old  standard  is  destined  to  confer 
upon  the  creditor  class,  while  the  annual  supplies  of  gold 
are  diminishing  in  quantity.  Whatever  advantage  there 
was  in  the  double  standard,  if  it  was  worth  the  planning 
of  one  class  to  destroy  it,  it  is  due  to  the  interests  of  the 
other  and  the  welfare  of  the  nation  to  restore  it. 

Moreover,  and  from  a  higher  point  of  view,  it  is  in  the 
long  run  really  to  the  interest  of  the  creditor  class,  as  well 
as  of  that  larscer  class  who  are  neither  creditors  nor  debt- 
ors,  for  us  to  restore  the  double  standard.  It  is  to  the 
interest  of  honor,  of  virtue,  of  religion,  of  good-will  to 
all  men  and  peace  upon  earth.  It  will  tend  to  save  the 
debtor  from  despair  and  the  resources  which  despair  iti- 
vites;  from  dishonest  bankruptcy,  from  flight,  from  the 
sequestration  of  property,  from  its  malicious  and  revengeful 
destruction,  from  popular  agitation,  agrarian  disturbances, 
and  revolution,  and  from  recourse  to  "interchangeable 
bonds"  or  other  covert  forms  of  repudiation. 

I  have  said  that  the  practical  effects  of  the  double  stand- 
ard would  be  like  that  of  a  single  metal  which  is  adhered 
to  forever.  I  meant  by  this  that  a  single  metal  adhered  to 
forever  would  have  its  ups  as  well  as  downs,  as  England 


88 

has  had  with  gold  since  1816.     It  was  down  with  the  peo- 
ple of  that  country  until  about  the  year  1832  or  1837,  then 
slowly  up  until  1848,  then  rapidly  up  until  1865,  and  since 
that  year  slowly  down.     AVith  a  double  standard,  England 
would  have  had  fewer  of  these  vicissitudes;  with  the  res- 
toration of  our  double   standard  we   shall  have  fewer  of 
them  than  otherwise.     These  vicissitudes  are  clearly  trace- 
able to  those  disturbances  of  the  double   standard  which 
commenced  in  1816.     They  are  still  unsettled.    With  their 
settlement,  with  the  return  of  nations  to  that  dual  employ- 
ment of  gold  and  silver  which  was  never  interrupted  until 
Eno-land  saw  fit  to  interrupt  it,  will  doubtless  return  that 
era  of  monetary  ease  and  serenity  which  characterized  the 
last   century,  during  which   the   Bank  of  England   rate 
scarcely  varied  one-half  of  one  per  cent.     Bank  panics  and 
financial  revulsions  will  disappear,  and  possibly  also  the 
thousand  and  oue   mad  schemes  of  irredeemable  paper 
which  necessity  and  despair  have  driven  men  to  entertain. 
But  a  single  standard  adhered  to  forever  is  something 
that  even  were  a  steady  enough  and  otherwise  suitable 
metal  obtainable  for  the  purpose— which  is  absolutely  de- 
nied—is not  to  be  looked  for.     It  is  true  that  England 
adhered  to  gold  all  through  that  period  so  trying  to  her 
plutocratical  rulers,  from  1818  to  1865,  but  it  was  not  without 
having  often  been  on  the  point  of  abolishing  it  and  resorting 
to  some  substance  for  money  the  supplies  of  which  did  not 
increase  so  rapidly.     The  propositions  of  Cobden  and  some 
of  the  other  writers  I  have  quoted,  in  favor  of  adopting 
wheat,  &;c.,  as  standards  of  value,  sulficieutly  attest  the  alarm 
of  the  ruling  classes.    But,  fortunately  for  the  people  of  Eng- 
land, the  popular  sufferings  of  the  previous  period  from  1816 
to  1830,  wlien  gold  was  yearly  diminishing  in  supply,  had 
gone  far  enough  to  produce  the  reaction  which  the  short- 
sighted and  selfish  adoption. of  the  gold  standard  so  richly 
merited.     A  stern  remembrance  of  these  sufferings  was 
abroad  in  the  land,  and   forbade  any    further   tampering 
with  the  standard.    The  people  said  in  efiect — 'Said  it  m  the 
Chartist  and  the  Anti-Corn  Law,  and  the  Reform  conten- 


89 

tions — it  was  youi*  turn  a  whilo  since,  it  is  oars  now; 
stand  back  aad  let's  have  fair  play!  The  yeomanry  of 
England  had  arisen  from  its  pauper  grave  and  the  voice  of 
power  trembled,  and  was  hushed  in  its  presence. 

While  these  circumstances  forbade  the  desertion  of  that 
standard  which  the  plutocracy  of  1816  had  set  up  for  itself, 
there  is  no  assurance  that  they  would  not  again  be  evoked 
to  prevent  a  change  of  the  standard  from  gold  to  silver 
should  the  latter  once  more  become  the  dearer  metal.     The 
plutocracy  of  England  found  strong  enough  arguments  to 
change  the  standard  from   the  double  to  the  single  and 
from  silver  to  gold.     The  plutocracies  of  the  Continental 
countries  have  changed  from  one  metal  to  the  other  when- 
ever  it  suited,  or  they  fancied  it  suited,  their  present  inter- 
est most.      Neitlier,  with  the  increasing  advantages  and 
power  which  the  retention  of  the  gold  standard  would  con- 
fer upon  our  rising  and  promising  regiments  of  plutocrats, 
would  this  class  fail  to  makesimilar  attempts  in  this  country, 
and  particularly  if  the  easy  success  they  met  with  in  1873  is 
suffered  to  stand  unrebuked.    In  effect,  the  standard  would 
be  changed  whenever  there  occurred  a  marked  change  in 
the  values  of  the  metals. 

We  should  have  a  double  standard,  indeed;  only,  in- 
stead of  standing  upon  two  supports  it  would  rest  upon 
one.  Instead  of  having  its  center  of  gravity  always  mid- 
way between  its  supports  it  would  have  one  that  rocked 
to  and  fro,*  and  at  every  oscillation  tore  away  a  portion  of 
those  foundations  of  equity  upon  which  alone  republican 
institutions  and  republican  government  may  permanently 
rest. 

RESORT    TO    A    GOLD    STANDARD    INEVITABLY    INVITES     PAPER 

INFLATIONS. 

An  extremely  important  consideration  has  been  adverted 
to,  and  demands  some  elaboration.  It  is  this:  that  any 
attempt  to  substitute  by  force  of  law,  gold  for  silver,  in 
the  money  of  a  country,  at  a  time  when  gold  is  becoming 


90 

scarcer,  either  absolutely  or  relatively  as  to  silver,  must 
surely  result  in  producing  paper  inflations.  Paper  notes, 
either  representative  or  unrepresentative,  are  sure  to  be 
issued  as  substitutes  for  gold  as  it  becomes  scarce.  Any 
attempt  to  artificially  enhance  the  purchasing  power  of 
gold,  either  by  demonetizing  or  partly  demonetizing  sil- 
ver, and  the  act  of  1873  is  of  this  nature,  is  certain  to 
invite  or  prolong  the  issuance  of  paper  notes.  By  arti- 
ficially enhancing  the  purchasing  power  of  gold,  the  profits 
arising  from  the  issuance  of  paper  notes  are  enhanced,  and 
the  pressure  on  the  part  of  banks  and  individuals  to  obtain 
authority  to  issue  them,  if,  indeed,  the  decline  of  prices 
and  consequent  stagnation  of  industry  does  not  induce  the 
Government  itself  to  issue  them,  will  become  too  great  to 
be  successfully  resisted.  This  authority  once  obtained,  or 
this  power  once  exercised,  it  always  proceeds  to  extremes. 
Neither  reason  nor  prudence  sets  a  limit  to  the  emission  of 
paper  notes;  the  emission  usually  continues  until  it  ends 
in  general  bankruptcy. 

This,  then,  is  what  the  purblind,  short-sighted  advocates 
of  a  single  metal,  when  both  metals  together  are  barely 
more  than  sufficient  to  prevent  the  world's  stock  of  coin 
from  falling  behind  the  increase  of  population,  this,  is 
what  they  would  invite.  They  would  press  the  blade 
down  to  the  point  at  which  it  is  bound  to  spring  up — 
spring  up  in  defective  and  excessive  credit,  in  speculation, 
in  madness,  in  bankruptcy,  and  in  crime.  They  would 
twist  the  thumb-screw  down  until  the  debtor  was  reduced 
to  poverty  and  despair,  forgetting  that  they  themselves, 
more  than  an}^  class  of  persons,  were  interested  in  keeping 
him  solvent  and  prosperous. 

The  lesson  is  the  same  in  all  artificial  or  forced  systems 
of  currency.  Money  came  into  existence  freely,  and  it  has 
never  yet  yielded  up  its  birthright.  Legislation  should 
not,  legislation  cannot  enthrall  it.  Beyond  the  scope  of 
temporarily  fixing  the  relation,  which  should  be  the  mean 
natural  or  market  relation,  between  two  metals,  both  of 
which   are  indispensable  for  the  purposes  of  exchange; 


91 

beyond  manufacturing  and  unitizing  coins,  and  punishing 
counterfeitors;  in  short,  beyond  the  exercise  of  that  sur- 
veillance, which  may  fitly  be  termed  the  police  of  money, 
legislation  has  neither  rightful  function  nor  power.  All 
it  can  do  beyond  this  is  to  confuse,  to  deceive  to  injure,  to 
disturb,  and  to  invite  loss,  discontent,  turbulence,  violence, 
and  anarchy. 

Gentlemen  may  fancy  that  they  are  playing  upon  a  very 
simple  instrument  when  they  undertake  to  meddle  with 
money.  But  they  are  mistaken.  The  apparently  simple 
instrument  is  an  organism  of  the  most  complex  character, 
the  result  of  thirty  centuries  of  growth  and  development, 
and  like  all  highly-developed  organisms,  impatient  of 
control  or  restraint.  It  recoils  from  the  first  touch  of  an 
unaccustomed  hand;  it  gives  forth  alarming  sounds;  and 
if  further  meddled  with,  it  revenges  itself  upon  its  dis- 
turber with  overwhelming  ruin. 

DANGER  OF  ABANDONING  THE  DOUBLE  STANDARD. 

It  is  impossible  to  resume  specie  payments  in  gold  alone. 
Let  us  try  to  grasp  the  full  significance  of  this  proposition, 
if  even  it  be  only  in  one  respect — that  of  the  capacity  of 
the  mines  of  the  world  to  supply  it  with  gold  enouiih  to 
measure  its  exchanges  without  the  co-ordinate  employment 
of  silver.  Given  bills  of  exchano-e,  o-iven  certificates  of 
deposit,  given  bank-bills,  given  government  legal-tender 
notes,  given  railways,  telegraphs — in  short,  any  form  of  rep- 
resentative or  non-representative  money  or  of  agencies  for 
increasingthe  rapidity  of  its  circulation — given  all  these,  and. 
the  world  now  employs  them  all  whenever  and  wheresoever 
they  can  he  employed  with  safety  or  advantage,  and  often 
when  neither  one  nor  the  other  is  secured;  given  all  these, 
and  yet  a  certain  quantity  of  the  precious  metals  is  needed 
at  bottom,  as  the  foundation  upon  which  the  entire  basis  of 
credit,  safe  and  unsafe,  must  rest.  ISTow,  how  much  does 
this  indii^pensable  quantity  of  the  precious  metals  amount 
to  at  the  present  time  ? 

There  is  no  difficulty  in  answering  this  question.     The 


92 

world's  stock  of  coin  is  $5,700,000,000,  of  which  nearly 
one-half  is  of  silver.  Of  this  sum  Europe,  America,  and 
the  rest  of  the  Occidental  world  employ  about  §3,600,000,- 
000.  Previous  to  the  ^atc  partial  demonetizations  of  silver 
in  the  Latin  Union,  and  iu  Germany  and  the  United  States, 
these  §3,600,000,000  consisted  of,  let  us  say,  $2,000,000,000 
of  gold  and  $1,600,000,000  of  silver.  They  now  consist  of 
say  about  $2,400,000,000  gold  and  $1,200,000,000  silver. 
By  continuing  to  exclude  silver  from  equal  participation 
with  gold  iu  the  currency  of  the  United  States,  and  attempt- 
ing to  resume  specie  payments,  we  occasion  a  demand  for 
say  $350,000,000  of  gold  wherewith  to  pay  off  the  green- 
backs and  furnish  bank  reserves  and  $50,000,000  of  silver  iu 
lieu  of  the  fractional  notes.  If  we  could  obtain  these  $400,- 
000,000  of  metal  without  drawing  it  from  other  countries  in 
Europe  or  America,  they  would  add  so  much  to  the  stock 
of  coin  iu  the  Occidental  world,  which  would  then  be 
$2,750,000,000  of  gold  and  $1,250,000,000  of  silver.  This 
is  the  answer  to  the  question  so  far  as  the  Occidental  world 
is  concerned.  The  quantity  of  the  precious  metals  needed 
for  money  and  the  basis  of  credit  in  the  Occidental  world — 
that  is  to  say,  the  quantity  needed  to  maintain  prices  at 
their  present  level— is  at  least  $4,000,000,000.  '  Of  this 
sum  the  Uiiited  States,  if  it  succeeds  in  resuming  specie 
payments,  will  hold  about  $400,000,000. 

Now,  let  me  ask,  in  the  first  place,  where  these  §400,000,- 
000  are  expected  to  come  from?  Gentlemen  may  dispute 
the  premiss  and  contend  that  no  such  sum  as  $400,000,000 
is  necessary.  They  may  point  to  the  fact  that  j ust  previous 
to  the  time  of  the  suspension  in  1862  the  entire  stock  of  coin 
in  this  country  was  estimated  at  not  over  $300,000,000,*  of 
which  probably  not  over  three-fourths  or  $225,000,000  were 
in  gold.  Granted  that  this  was  the  fact,  and  I  have  no 
doubt  it  was,  it  must  not  be  forgotten  that  since  1862  the 
population  of  this  country  has  increased  50  per  cent.,  and 
its  exchanges  fully  100  per  cent.    What  is  the  proof  of  this  ? 


*  Finance  Keport,  18C1,  pp.  25  and  62. 


93       - 

Simply  that  in  1861  our  whole  circulating  media  consisted  of 
$300,000,000  in  coin  and  $200,000,000  of  bank  notes,  which 
ciYculatedwithin  limited  areas  at  or  nearly  par;  whereas,  now 
it  consists  of  not  more  than  $140,000,000  of  coin  and  some 
$750,000,000  of  Government  and  bank  paper,  the  latter  cir- 
culating (throughout  nearly  the  whole  country)  at  about  87^ 
cents  to  the  dollar;  say  total  circulation  at  par  equal  to 
$800,000,000.  This  is  70  per  cent,  more  than  the  par  cir- 
culation of  1861;  an  incontestable  proof  that  exchanges  have 
increased  in  volume  at  least  70  per  cent.  Taking  into 
consideration  the  superior  activity  of  the  legal  tender  and 
national  bank  notes  over  the  old  State  bank  notes,  and  the 
improvement  and  development  of  railways,  telegraphs, 
clearing  houses,  and  other  mechanisms  of  exchange,  since 
1861,  it  cannot  be  doubted  that  the  bulk  of  to-day's  ex- 
changes in  this  country  is  at  least  double  that  of  a  corre- 
sponding day  in  1862.  Suppose,  however,  we  put  it  at  only 
70  per  cent,  higher:  then,  in  order  to  resume  specie  pay- 
ment upon  at  least  as  firm  a  footing  as  specie  payments 
stood  in  1861 — and  the  universal  suspension  of  the  banks 
toward  the  end  of  that  year  proves  that  it  was  not  so  firm 
a  footing  as  could  have  been  wished — we  shall  require  at 
least  70  per  cent,  more  specie  than  we  emploj'Cd  in  1861. 
Add  70  percent,  to  $300,000,000,  and  you  have  $510,000,- 
000.  Allow  $140,000,000  for  specie  already  in  the  coun- 
try, in  the  banks,  in  private  hands,  and  in  the  vaults  of  the 
Treasury,  and  you  will  need  $370,000,000  in  order  to 
resume.  Of  this  $370,000,000  the  Government  will  need, 
perhaps,  about  $350,000,000,  and  the  banks  the  remainder. 
But  the  apportionment  is  of  no  consequence  in  this  connec- 
tion. The  substantial  fact  is  that  in  order  to  resume  specie 
payments  we  shall  need  $370,000,000,  say,  for  round  fig- 
ures, $400,000,000,  of  specie,  of  which,  under  the  operation 
of  the  act  of  1873,  about  $350,000,000  must  be  in  gold. 

I  now  ask  where  are  these  $350,000,000  expected  to  come 
from?  Again,  do  I  fanc}'  I  hear  interpellation.  I  shall 
perhaps  be  told  that  a  proposition  is  even  now  before  Con- 
gress, a  proposition  from  careful   and  able  sources,  and 


94 

boasting  the  indorsement  of  high  financial  authority,  a 
proposition  which  assumes  that  $100,000,000  in  gold  will 
be  sufficient  wherewith  to  enable  the  country  to  return  to 
specie  payments. 

I  refer  to  a  speech  which  has  been  made  in  the  Senate. 
But  I  warn  gentlemen  to  beware  of  making  a  mistake  in 
respect  of  this  matter,  for  a  mistake  will  set  us  back  many 
years.  The  British  Government  tried  to  resume  in  1817, 
after  a  suspension  of  twenty  years,  but  it  failed,  and  resump- 
tion was  deferred  for  seven  other  years,  until  1824.  If  we 
try  to  resume  in  1879  with  $100,000,000  and  fail,  we  may 
be  set  back  a  quarter  of  a  century.  Moreover,  if  we  fail, 
somebody — most  probably  some  clique  of  stock  gamblers — 
will  make  fifteen  or  twenty  per  cent,  out  of  the  operation. 
How?  Easy  enough!  Knowing  that  $100,000,000  was 
the  limit  of  the  Government's  ability  to  pay,  they  could 
easily  make  arrangements  with  the  banks  and  depositories 
throughout  the  country  to  withdraw  §100,000,000  of  green- 
backs on  the  eve  of  the  day  of  resumption,  and  present 
them  for  payment  at  the  Treasury.  After  having  drawn 
the  last  dollar  of  specie  out  of  the  latter  they  could,  by 
presenting  an  additional  note,  compel  it  to  suspend  again. 
Then  gold  would  go  up  once  more,  perhaps  to  the  full 
extent  of  the  figure  from  which  it  would  have  fallen,  and 
the  clique  could  sell  their  specie  in  the  market  and  realize 
their  profit. 

This  is  not  only  a  possible  occurrence  ;  it  is  a  probable 
one;  a  highly  probable  one;  almost  a  certainty.  There 
is  nothing  in  the  world  to  prevent  it,  except  two  things : 
First,  the  inability  of  a  clique  to  raise  $100,000,000;  sec- 
ond, the  possibility  that  the  Treasury,  in  offering  to 
redeem  its  issues,  may^  arbitrarily  and  unexpectedly,  pre- 
fer notes  of  particular  numbers  or  dates  of  issue.  But 
these  objections  are  frivolous.  Experience  has  demon- 
strated that  there  is  no  difficulty  whatever  on  the  part  of 
stock -jobbing  cliques  to  raise  §100,000,000,  whilst,  with 
regard  to  making  preferred  credits  of  certain  notes,  the 
Treasury  has  no  authority  to   do  so,  and   if  it   had,  the 


9 


r 


exercise  of  such  authority  would  be  almost  certain  to  be 
defeated  through  treachery.  Secrets  so  weighty  as  this 
one  would  be,  are  impossible  to  keep.  Even  if  it  did  not 
leak  out,  the  clique  would  be  certain  to  monopolize  the 
Treasury  doors  to  the  exclusion  of  all  comers.  In  siiort, 
wealth,  power,  organization,  experience,  and  special  train- 
ing, would  be  ranged  on  the  one  side,  against  a  scattered 
andindifterent  population  on  the  other;  and  who  can  doubt 
which  would  win  ? 

Finally,  even  if  carried  out  successfully,  the  exercise  of 
such  authority  would  be  unlawful  and  unjust. 

We  cannot  resume  with  $100,000,000,  nor  with  $200,- 
000,000.  Why,  gentlemen,  we  have  had  -^140,000,000  in 
specie  in  the  Treasury  on  several  occasions  during  the 
past  ten  years.  If  it  is  practicable  to  resume  now  with 
^100,000,000,  why  was  it  not  practicable  on  those  occasions 
with  $140,000,000?  It  was  certainly  not  for  lack  of  desire 
on  the  part  of  the  Secretary  of  the  Treasury,  but  simply 
because  both  the  Secretary  and  Congress  plainly  saw  that 
the  thing  could  not  be  done. 

It  is  better  to  be  on  the  safe  side  of  an  operation  of  this 
magnitude  and  importance.  It  is  better  to  have  a  dollar 
more  than  is  necessary  for  the  purpose  of  resuming,  than  a 
dollar  less  than  is  necessary.  We  cannot  expect  to  resume 
upon  false  pretences.  We  cannot,  and  if  we  can,  we  ought 
not,  hoodwink  the  people,  or  run  the  risk  of  failing,  and, 
therefore,  of  unsettling  values  for  an  indefinite  period  in 
the  future.  In  order  to  resume  we  must  pay  dollar  for 
"dollar,"  and  dollar  for  dollar,  as  the  law  now  stands, 
means  at  least  $350,000,000  in  gold. 

And  now  for  the  third  time  I  ask,  where  are  these  $350,- 
000,000  to  come  from?  Gentlemen  may  differ  with  me  as 
to  the  sura  needed  for  resumption.  Some  may  believe 
$200,000,000  are  enough,  others  may  even  consider  $100,- 
000,000.  I  have  briefly  discussed  these  opinions,  and  do 
not  believe  that  less  than  $350,000,000  will  suffice.  With  only 
$129,500,000  of  Bank  of  England  and  $144,000,000  of  Pro- 
vincial  bank-notes  afloat  in  1815,  total    $273,500,000  in 


96 

paper,  Euglaud  required  over  $270,000,000  in  coin  before 
she  was  enabled  to  resume.  After  you  shall  have  resumed, 
less  coin  may  be  required  in  the  country;  but  in  order  to 
resume,  you  will  require  a  dollar  in  coin  for  every  dollar  of 
Government  paper  afloat,  and.  in  ray  opinion,  and,  as  shown 
by  the  experience  of  England,  you  will  also  have  to  give 
the  national  banks  time  to  acquire  an  equal  fund  of  specie, 
before  they  can  resume ;  otherwise,  you  may  bankrupt  every 
one  of  them. 

Confining  myself  to  the  strict  requirement  of  the  Gov- 
ernment, I  again  ask  where  is  the  requisite  specie  to  come 
from  if  we  are  to  depend  upon  gold  alone  ? 

The  annual  gold  product  of  the  world  is  given  at 
$97,500,000,  of  which  let  us  say  the  whole  amount  can  be 
retained  in  the  Occident,  which  all  will  admit  is  a  violent 
stretch  of  probability.  It  is  estimated  that  considerably 
more  than  one-half  of  this  supply  is  needed  for  the  arts,  for 
gilding,  plating,  watchcase  making,  jewelry,  and  the  like.* 
Let  us  limit  this  demand  to  one-half:  this  would  leave  a 
supply  of,  say  $49,000,000  of  gold  per  annum,  available  for 
the  maintenance  and  increase  of  money.  The  maintenance 
of  money  costs  about  one  and  a  half  per  cent,  per  annum 
in  abrasion  and  loss.  One  and  a  half  per  cent,  on  the 
present  Occidental  stock  of  $2,600,000,000  gold  amounts  to 
$39,000,000.  This  is  the  quantity  of  gold  needed  every  year 
to  maintain  the  existing  stock  of  gold  coin  in  the  Occident. 
Deduct  this  from  $49,000,000,  the  total  annual  supply  avail- 
able for  money,  and  there  would  remain  a  surplus  of 
$10,000,000  a  year.  It  is  out  of  this  surplus  that  our  $350,- 
000,000  must  come,  unless  it  comes  out  of  the  existing 
stock  in  other  countries,  a  point  which  will  be  considered 
farther  on. 

Upon  the  most  favorable  hypotheses,  after  according 
every  debatable  point  in  favor  of  the  feasibility  of  the  propo- 
sition, we  should  have  to  wait  nearly  thirty-five  years  to 
accomplish  it  in  practice;  for  if  we  managed  to  obtain  every 

*Seyd. 


97 

ounce  of  gold  which  can  be  spared  from  the  sappliea  of 
the  world  for  the  next  thirty-five  years  we  shall  barely 
have  secured  enough. 

There  are  considerations,  however,  which  render  some 
of  these  hypotheses  untenable. 

The  entire  population  of  the  Occidental  world  is  increas- 
ing at  the  rate  of  one  per  cent,  per  annum.*  Even  if  its 
exchanges  or  their  bases  increased  no  faster  than  its  popu- 
lation, this  fact  would  require  an  annual  addition  of  1  per 
cent,  to  the  stock  of  coin.  At  the  present  time  this  would 
absorb  nearly  $3,000,000  per  annum. 

The  demand  for  gold  in  the  arts  will  undoubtedly 
increase  at,  at  least,  an  equal  rate.  The  probability  is  that 
it  will  increase,  because  it  has  increased,  at  a  greater  ratio. 
Limiting  it  to  this  ratio,  it  will  amount  to  nearly  another 
$3,000,000  per  annum. 

The  annual  product  of  gold  throughout  the  world  is 
diminishing.  It  was  $182,000,000  in  1852;  it  is  given  at 
only  $97,500,000  in  1875.  This  is  a  decrement  of  over 
$3,500,000  per  annum. 

On  accountof  these  considerations  we  must  subtract  about 
$9,500,000  per  annum  from  the  world's  available  annual 
surplus  of  $10,000,000,  leaving  but  $500,000  per  annum  to 
spare.  At  the  rate  of  $500,000  per  annum  we  shall  need 
seven  hundred  years  in  which  to  garner  up  $350,000,000, 
the  amount  necessary  wherewith  to  resume  payment  in 
gold  ! 

The  possibility  of  performing  even  this  feat  rests  upon  the 
assumption  that  Austria,  which  has  a  forced  paper  currency; 
and  Italy,  which  has  a  forced  paper  currency;  and  Russia, 
which  has  a  forced  paper  currency;  and  several  other 
countries  which  have  forced  paper  currencies ;  countries 
which  in  the  aggregate  contain  one-half  of  the  entire 
European  population  of  the  globe;  will  be  content  to  wait 
until  the  United  States  gets  its  quantum  of  gold  wherewith 
to  resume,  before  they  will  make  any  move  to  effect  a 

*  Essay  on  Population  of  the  Earth  in  New  York  Independent. 

7 


P8 

similar  reform  in  their  own  currencies.  It  rests,  also,  upon 
the  assumption  that  the  people  of  the  United  States  will 
wait  during  these  years  for  the  consummation  of  resump- 
tion :  wait  without  complaint,  without  further  legislation, 
without  getting  tired,  or  yielding  to  the  clamors  of  interest, 
or  prejudice,  or  ignorance. 

RESUMPTION  ON  A  GOLD  BASIS  IMPOSSIBLE. 

I  tell  you,  gentlemen,  the  thing  cannot  be  done ! 
Resumption  in  gold  is  out  of  the  question.  It  is  not 
practical  financially,  it  is  not  practical  metallurgically,  it  is 
not  practical  internationally,  it  is  not  practical  politically, 
in  short  it  is  not  practical  at  all. 

I  can  no  longer  wonder  that  the  Interchangeable  Theory 
or  any  other  form  of  paper  lunacy  has  obtained  a  footing 
in  the  land.  So  long  as  intelligent  and  educated  men  will 
persist  in  attempting  to  do  that  which  the  most  unintelli- 
gent and  uneducated  plainly  perceive  to  be  impossible, 
so  long  will  demagoguery  and  roguery  have  a  footing! 
"  My  plan,"  they  will  say  "is  at  least  as  good  as  theirs;  " 
meaning  that  of  the  gold  resumptionists.  And  I  must 
confess  that  I  assent  to  their  proposition.  One  plan  is 
quite  as  good  as  the  other,  and  not  a  whit  better.  They 
are  both  utterly  impracticable,  and  no  attempt  to  carry 
out  either  one  of  them  can  have  atiy  other  than  one  end- 
ing: failure.violent  fluctuations  and  unsettleraent  of  values, 
distress,  commotion,  and  the  grave  dangers  that  lurk 
beneath  all  violent  upheavals  of  the  body  politic. 

There  are  two  forms  of  reply  that  I  anticipate  to  the 
assertion  that  it  is  impossible  in  less  than  a  great  number 
of  years  to  obtain  the  requisite  supply  of  metal  wherewith 
to  resume  specie  payments  in  gold.  One  is,  if  money  is 
merely  a  measure  of  values,  why  will  not  $100,000,000  or 
even  $50,000,000  measure  values  as  well  as  $350,000,000  or 
any  other  sum  ?  The  puerility  involved  in  this  reply  needs 
little  further  response  than  what  has  already  been  accorded 
to  it  in  a  previous  portion  of  this  speech.  If  there  was  no 
accumulated  stock  of  coin  in  the  world,  upon  which  values 


99 

throughout  the  world  already  rested;  if  there  were  existing 
no  contracts,  rents,  leases,  bonds,  mortgages,  and  the  like, 
executed  in  the  past  and  maturing  now,  or  executed  now 
and  to  mature  in  the  future;  in  a  word,  if  the  world  was  born 
to-day,  $50,000,000  would  in  theory  answer  quite  as  well  for 
the  entire  money  of  this  country,  aye,  even  of  the  whole 
world,  as  any  other  sum.  But  the  world  was  not  born  to- 
day, nor  yesterday,  nor  the  day  before.  The  stock  of  coin 
which  forms  the  substratum  of  the  world's  prices  is  the 
accumulation  of  fifty  centuries,  and  bargains  are  being 
made  every  day — for  example.  Government  and  corporative 
debts — which  cover  long  periods  of  time.  To  disturb  these 
prices  and  contracts  by  forcing  the  exchanges  of  the  country 
to  be  measured  by  a  sum  of  specie  so  vastly  less  than  its 
usual  measure,  as  $100,000,000  or  even  $200,000,000  would 
be,  would  be  tantamount  to  the  violent  destruction  of  vast 
interests  and  a  wrenching  of  all  the  relations  of  industrial 
and  social  life.  Imagine  workingmen's  wages  at  twelve- 
and-a-half  cents  a  day  in  this  coontry,  while  they  stood  at 
$2  in  France  or  England.  Imagine  our  railway  corpora- 
tions forced  to  pay  their  rents  on  long  leases,  and  the  inter- 
est on  long  bonds,  in  daily  appreciating  gold.  Would  not 
this  be  quite  as  unjust  as,  on  the  other  hand,  by  issuing  a 
daily  depreciating  interchangeable  token,  to  gratuitously 
save  them  from  that  disaster? 

The  other  reply  that  I  anticipate  to  the  objection  that 
we  cannot  obtain  gold  enough  wherewith  to  resume,  is 
this:  "We  can  obtain  the  gold  from  Europe."  Can  we? 
Let  us  examine  this  point. 

CAN    WE    GET    GOLD    ENOUGH    FROM     EUROPE    WHEREWITH     TO 
RESUME    SPECIE    PAYMENTS? 

"When  a  merchant  purposes  to  buy  a  large  quantity  of  a 
given  article,  his  first  thought  is  to  compute  how  much  his 
demand  will  raise  the  price  of  the  article  during  the  pro- 
gress of  the  purchase.  The  first  element  in  this  calcula- 
tion is  the  stock  on  hand,  the  next  is  the  current  supply 


100 

and  demand.  It  is  the  same  with  the  stock  operator,  in 
short,  with  dealers  in  all  commodities.  AVhy  should  it 
not  be  the  same  with  Government  when  it  goes  into  the 
market  for  1350,000,000  of  gold  ? 

The  current  demand  and  supply  of  this  article  has  been 
discussed.  There  is  no  stock  of  it  on  hand  in  the  same 
sense  that  there  is  a  stock  or  accumulation  of  merchan- 
dise. The  stock  of  merchandise  is  the  unused  portion — 
the  surplus.  There  is  no  unused  stock  of  gold  coin  in  the 
world,  no  surplus.  It  is  all  in  use  to  support  prices;  *  with, 
draw  it,  and  the  whole  fabric  of  prices  and  credits  falls  to  the 
dust.  The  stock  of  gold  in  Europe  and  the  countries  settled 
by  Europeans  amounts  to  about  $2,600,000,000.  On  every 
one  of  these  dollars  stands  a  vast  and  almost  toppling  super- 
structure of  credits  in  every  conceivable  form.  You  now 
propose  to  purchase  one-eighth,  almost  one-seventh,  of  this 
entire  basis  of  the  rest  of  the  Occidental  world's  exchano^es 
and  credits.  Do  you  believe  you  can  do  it?  Do  you  believe 
you  can  oft'er  your  bonds  or  your  merchandise  in  the 
markets  of  Europe  low  enough  to  purchase  with  them 
1350,000,000  of  gold?  Do  you  suppose  that  United  States 
5  per  cent,  bonds  at  par,  or  90,  or  80,  or  even  70,  will  accom- 
plish it?  Or,  to  put  it  another  way,  suppose  you  determine 
not  to  sell  your  bonds  under  par:  do  you  suppose  that  you 
can  place  them  at  any  rate  of  interest  to  which  the  self- 
respect  of  this  country  would  submit,  or  which  its  resources 
would  justify  ?  Do  you  suppose  that  when  you  commenced 
to  draw  gold  from  Europe,  the  Bank  of  England  and  other 
like  institutions,  would  not  raise  their  rate  of  interest 
to  7,  8,  10,  or  even  12  per  cent.?  You  know  that  this  is 
always  done  when  specie  is  observed  to  be  flowing  out. 
You  know  that  it  must  be  done.  And  do  you  suppose 
that  when  it  is  done  that  you  can  place  your  bonds  at  any 
lower  rate  of  interest  than  the  bank  rate  ?  Do  you  imagine 
that  American  produce  or  manufactures  offered  to  Europe 
at  three-fourths  of  their  present  market  prices  will  do  it  ? 

*The  legal  tender  portioii  at  a  full  ratio  of  acti\ity;  the  subsidiary 
coins  at  a  lesser  rate. 


101 

Well,  then,  I  do  not.  To  induce  Europe  and  the  European 
world  to  part  with  one-seventh  of  its  measure  of  exchanges 
and  basis  of  credit,  within  the  time  fixed  for  the  resump- 
tion of  specie  payment  in  this  country,  you  would  have  to 
sell  all  your  moveables — for  remember  that  lands,  which 
constitute  more  than  one-half  of  our  wealth,  cannot  be 
exported — at  prices  which  would  bankrupt  every  industry 
in  this  country.  You  might  get  $10,000,000,  or  $20,000,- 
000,  or,  perhaps,  even  §50, 000, 000,  in  gold.  By  dint  of 
hammering  the  bond  market  (and  you  would  have  to  author- 
ize the  Treasury  to  sell  below  par,  at  any  price  the  bonds 
would  fetch)  during  the  two  years  and  a  half  now  remain- 
ing, you  might  even  get  .$100,000,000  of  metal;  but  when 
you  shall  have  taken  |100, 000,000  away  from  Europe  you 
will  have  produced  a  commotion  and  a  fall  in  prices  on 
the  other  side,  that,  if  it  did  not  lead  to  the  closure  of  the 
European  stock  markets  to  American  bonds,  would  cer- 
tainl}^  precipitate  a  tremendous  financial  convulsion.*  As 
for  this  side,  the  effects  would  be  no  less  alarming. 

Recollect,  gentlemen,  that  the  problem  is  that  of  taking 
$350,000,000  in  gold  out  of  a  fully  occupied  and  heavily 
over-topped  basis  of  only  $2,600,000,000  in  the  Occidental 
world.  It  is  not  the  whole  stock  of  metal,  both  silver  and 
gold,  that  we  can  now  call  upon,  as  in  former  days.  Silver 
has  been  demonetized  in  several  countries  of  Europe ;  it 
has  been  demonetized   here.     We  have  thoughtlessly  so 

*  "When  the  negotiations  were  going  on  in  Loudon  for  the  sale  of  tlie 
largest  amount  of  United  States  bonds  that  have  ever  been  sold  tliere  at 
one  time,  it  was  foreseen  by  the  Bank  of  England  tliat  a  quantity  of 
coin  would  accumulate  as  the  proceeds  of  tliese  bonds  to  the  credit  of 
the  Goyernment  of  the  United  States.  xVs  a  matter  of  fact  there  was 
an  accumulation  of  about  $21,000,000.  The  Banli  of  England,  foresee- 
ing tliat  tliere  would  be  an  accumulation  of  coin  to  the  credit  of  the 
United  States,  which  might  be  taken  away  bodily  in  specie,  gave  notice 
to  the  officers  of  the  Treasury  Department  of  the  United  States  that  the 
power  of  that  institution  would  be  arrayed  against  the  whole  proceeding 
unless  we  gave  a  pledge  tliat  the  coin  sliould  not  be  removed,  and  that 
we  would  reinvest  it  in  the  bonds  of  tlie  United  States  as  they  were 
offered  in  the  markets  of  London.  We  were  compelled  to  coinph/!" — 
Speech  of  Senator  BoidivelU  formerly  Secretary  of  the  Treasury, 
(Cong.  Becord,  43d  Cong.,  1st  Session,  vol.  2,  part  6,  p.  23  of  Ajjpendix.) 


102 

worded  our  laws  that,  until  we  alter  them,  we  can  only 
pay  in  gold.  The  Latin  Union,  Germany  and  Scandina- 
via, together  with  England  and  Portugal,  &c.,  have  so 
worded  their  laws,  whether  thoughtlessly  or  not,  you  can 
decide  for  yourselves,  that  gold  alone  is  the  legal-tender 
in  those  countries  for  the  payment  of  large  sums,  and  its 
value  is  the  st mdard  of  all  payments,  large  or  small. 
We  would  demand  of  them  one-seventh  of  their  entire 
stock,  which  now,  unlike  the  period  from  1848  to  1865,  is 
not  increasing;  which,  in  fact,  has  a  strong  tendency  to 
decrease.  Who,  under  these  circumstances,  will  have  the 
hardihood  to  assert  that  this  problem  is  a  practical  one? 
And  who  will  venture  to  deny  that,  if  it  is  solved  at  all,  it 
can  only  be  solved  at  a  sacrifice  more  overwhelming  than 
any  which  has  presented  itself  to  the  consideration  of  finan- 
ciers since  the  study  of  money,  its  functions  and  its  vicissi- 
tudes, first  became  a  science? 

OUR  INTEREST  CHARGE  ANOTHER  OBSTACLE  TO  RESUMPTION 

IN  GOLD. 

On  top  of  the  many  insuperable  difliculties  which  lie  in 
the  way  of  resumption  in  gold,  lies  another  one  which  is  as 
great  as  any  of  them,  and  which  you  would  augment  by 
attempting  to  resume  in  gold.  I  allude  to  the  interest  on 
the  public  debt,  which  debt  is  very  largely  held  abroad. 
This  interest  now  amounts  to  nearly  ^100,000,000  per  an- 
num. By  selling  bonds  to  the  extent  of  $350,000,000,  say 
at  10  per  cent. — for  it  is  perhaps  hopeless  to  expect  to  do  it 
at  a  lesser  sacrifice — you  will  add  $35,000,000  a  year  to  your 
gold  interest  debt,  and  those  $35,000,000  to  the  portion  held 
abroad.  Where  are  these  $35,000,000  to  come  from? 
Where  are  the  whole  $135,000,000  to  come  from?  Your 
annual  interest  charo-e  will  alone  amount  to  more  than  the 
whole  world's  product  of  gold.  So  far  as  the  portion  of  it 
which  is  paid  to  bondholders  in  this  country  is  concerned, 
it  may  stay  here  and  be  thrown  upon  the  market,  and  pur- 
chased by  the  Government,  and  so  used  over  and  over 
again,  as  is  the  case  now.  But  not  so  with  the  portion 
that  goes  abroad.    You  cannot  hope  to  get  any  of  that  back 


103 

without  selling  the  merchandise  of  the  country  at  lower 
rates  than  Europeans  will  be  willing  to  take  for  similar 
merchandise  of  their  own  production,  and  after  you  shall 
have  drained  Europe  of  one-fifth  of  its  specie,  (one-seventh 
of  the  whole  Occidental  world's,  or  one-fifth  of  Europe's,) 
prices  will  fall  to  a  very  low  point  there,  and  you  would 
have  to  sell  very  low  to  compete.  Are  your  farmers 
ready  to  deliver  their  wheat  in  Europe  at  the  rate  of  40  or 
50  cents  a  bushel?  Are  your  manufacturers  prepared  to 
sell  their  cotton  prints  at  2  cents  a  yard? 

I  warn  you,  gentlemen,  that  the  attempt  will  be  futile; 
that  the  thought  is  absurd;  that  the  whole  theory  of  en- 
deavoring to  destroy  one-half  of  the  world's  accumulation 
of  the  precious  metals  or  of  taking  part  in  the  attempt,  as 
you  would  do  by  attempting  to  resume  in  gold  alone,  is 
sheer  madness. 

COMPARATIVE  EASE  OF  RESUMING  IN  THE  DOUBLE  STANDARD. 

]!^ow  let  us  contrast  with  this  impracticable  scheme  the 
ease  of  resuming  specie  payments  in  both  the  metals,  or,  on 
the  basis  of  that  double  standard  which  the  world  has  used 
for  thirty  centuries,  and  after  an  endless  variety  of  experi- 
ments, without  being  able  to  dispense  with  it  or  even  ven- 
turing to  trifie  with  it  until  Change  Alley  found  that  money 
was  to  be  gained  by  inducing  these  experiments  to  be  made 
in  England  and  on  the  Continent. 

If  we  resolve  to  resume  in  gold  and  silver,  instead  of 
having  to  draw  upon  a  fund  of  $2,600,000, 000  and  an  an- 
nual supply  of  $97,500,000,  as  in  the  case  of  gold  alone,  we 
would  have  a  fund  of  §5, 700,000,000  and  an  annual  supply 
of  §170,000,000  to  draw  upon.  Not  only  is  the  fund  more 
than  twice  as  great,  and  the  supply  nearly  twice  as  great, 
but  both  the  fund  and  the  supply  are  more  widely  distrib- 
uted. Instead  of  having  to  draw  upon  the  Occident  alone, 
we  would  have  the  whole  World  to  draw  upon.  Three 
hundred  and  fifty  millions  in  gold  form  one-sev^enth  of  the 
entire  stock  of  that  metal;  the  same  sum  in  both  the  metals 
forms  less  than  one-sixteenth  of  the  entire  stock.  If  a 
draft  of  one-seventh  would  occasion  a  fall  in  prices  of  15 


104 

per  cent.,  a  draft  of  less  than  one-sixteenth  would  occasion 
a  decline  of  less  than  6  per  cent.;  and  while  15  per  cent.,  dur- 
ing two-and-a-half  years — equal  to  6  per  cent  per  annum — 
would  sweep  away  all  and  more  than  all  the  profits  of  in- 
dustry, which,  on  the  whole,  do  not  net  over  3  or  4  per 
cent.,  6  per  cent,  in  two-and-a-half  years,  equal  to  2|-  per 
cent,  per  annum,  would  enable  us  to  get  back  to  a  sound 
measure  of  values  without  the  loss  of  more  than  a  very 
small  portion  of  our  current  industrial  profits. 

It  has  been  objected  to  the  monetization  of  silver  by  the 
United  States  that  the  Comstock  lode  was  vomiting  forth 
a  vast  surplus  of  that  metal.  It  is  only  to  be  regretted  that 
this  is  not  the  fact;  for  if  gentlemen  will  consult  the  statis- 
tics of  the  precious  metals,  they  will  perceive  that  since 
1852,  when  the  product  of  gold  and  silver  was  1223,000,000, 
the  annual  supply  has  fallen  off"  so  that  in  1875  it  was  but 
$170,000,000,  aud  in  1876  will  probably  not  be  more. 
There  is  therefore  great  danger  of  a  dearth  of  metal,  aud  it 
would  be  fortunate  if  the  yield  of  the  Comstock  lode  were 
more  prolific  than  it  is. 

My  fear  is  that  this  prolificity,  such  as  it  is,  will  have 
reached  its  maximum  within  the  present  year.  It  is  the 
candid  opinion  of  a  man  who  has  devoted  nearly  thirty 
years  of  his  life  to  the  practical  working  and  management 
of  gold  and  silver  mines  that,  so  far  the  Comstock  lode  is 
concerned,  and  he  is  entirely  familiar  with  this  great  silver 
deposit,  we  have  arrived  at  the  beginning  of  the  end.  We 
now  know  the  probable  dimensions  and  bearings  of  the 
ore  producing  chimneys,  and  can  very  plainly  foresee  their 
early  exhaustion.  Whatever  the  fact  may  be  with  regard 
to  the  Comstock  lode,  and  at  best  it  is  but  matter  of  opinion, 
we  know  that  for  the  present  and  so  far  as  we  can  see 
ahead,  the  combined  annual  product  of  the  two  metals 
throughout  the  world,  as  compared  with  late  years,  is 
decreasing. 

If  now  the  question  be  asked :  Where  will  you  get  your 
$350,000,000  from,  upon  which  to  resume  ?  the  best  answer 
we  can  make  is:  From  the  world  at  large;  from  a  stock  of 
$5,700,000,000   in  gold  and  silver  coin;  from  an  annual 


105 

supply  of  $170,000,000 ;  from  Europe,  from  Mexico  and 
South  America,  from  Asia,  and,  readiest  and  best  of  all, 
from  our  own  mines. 

In  buying  metal  from  the  rest  of  the  world,  as  we  should 
have  to  do  had  we  no  great  mines  of  our  own,  we  should 
have  to  buy  it  with  the  accumulated  charges  of  transport 
and  coinage  upon  it.  In  buying  it  from  our  own  mines 
we  can  buy  it  at  its  worth  upon  the  spot  of  production, 
without  transportation  or  coinage,  or  interest  charges 
upon  it. 

RESTORATION    OF    THE    DOUBLE     STANDARD    AND    OUR    MINING 

INTERESTS. 

And  here  let  me  say  that  the  mining  interests  of  this 
country  are  represented  not,  as  some  persons  absurdly  sup- 
pose, by  a  few  millionaires,  but  for  the  most  part  by  a  vast 
number  of  persons,  with  no  other  resources  than  their  in- 
telligent minds  and  willing  hands,  who  work  in  the  mines 
for  daily  bread,  and  by  a  scarcely  less  numerous  class  of 
small  proprietors,  themselves  also  workingmen,  who  hold 
each  a  few  shares  in  the  mines  in  which  they  are  employed. 

The  miners  of  the  West  are  among  the  most  stalwart 
and  spirited  yeoman  in  the  world.  They  are  inured  to 
danger  and  toil,  and  are  brave,  strong,  intelligent,  and 
self-reliant.  In  weary  processions  across  alkaline  deserts, 
under  equatorial  and  blistering  suns,  across  mountain  and 
valley,  desert  and  plain,  amidst  the  attacks  of  savages  and 
the  fevers  of  tropical  swamps,  they  marked  the  path  and 
blazed  the  trail  of  Western  Empire.  They  overcame  every 
hostile  condition  and  builded,  on  foundations  of  Liberty 
and  Justice,  three  great  States  in  your  western  border. 
They  conquered  the  Genius  of  Sterility  in  its  stronghold, 
built  cities  10,000  feet  above  the  level  of  the  sea  and  hewed 
out  thrifty  workshops  2,500  feet  below  the  surface  of  the 
earth.  They  have  organized  mining  with  the  exactness 
and  thoroughness  of  science,  and  in  this  respect  placed 
this  country  in  the  vanguard  of  the  nations.  They  have 
neither  avoided  your  tax-gatherers,  sought  your  subsidies, 
nor  demanded  your  protective  legislation.     Nor  do  they 


106 

do  so  now.  They  only  ask  that  you  shall  legislate  in  re- 
spect of  this  great  question  in  view  of  the  history  of  the 
world,  the  Constitution  of  the  country,  and  the  facts  that 
surround  you. 

While  the  miners  of  this  country  have  the  highest  right 
both  by  reason  of  their  birth,  their  indomitable  love  of 
freedom,  and  the  perilous  nature  of  their  industry,  to  de- 
mand both  favor  and  advantage  from  the  Government, 
they  do  not  ask  for  either.  But  they  demand  that  the 
Constitution  shall  be  respected,  and  the  laws  enforced 
under  which  they  established  the  great  industry  which 
they  represent.  They  know  full  well  that  the  world's 
accumulated  stock  of  silver  is  too  vast  and  the  annual 
diminution  from  abrasion  and  loss  too  great,  to  fear  any 
permanent  or  continued  fall  in  the  price  of  that  metal. 
They  know  that  silver  must  continue  to  remain  the  money 
of  a  main  part  of  the  world  for  centuries  to  come,  and  that 
it  cannot  be  dispensed  with  in  any  part  of  the  world. 
They  understand  too  well  the  fluctuating  character  of  the 
supplies  of  gold,  to  fear  that  this  metal  will  permanently 
usurp  the  place  of  silver  in  the  money  of  the  world,  or  in 
the  money  of  any  considerable  part  of  the  world.  They 
perfectly  well  comprehend  the  fact  that  the  present  slight 
fall  of  silver  is  due  to  the  mad  attempt  to  demonetize  it 
wholly  or  partly  in  the  countries  of  the  Latin  Union 
and  Germany,  and  are  not  at  all  alarmed,  either  as  to  the 
success  of  this  attempt  or  the  future  price  of  silver.  They 
believe,  as  Jefferson  said  in  discussing  this  very  same 
subject  nearly  a  century  ago,  that  the  world's  long  and 
constantly-tried  experience  of  silver  is  a  kind  of  precedent 
which  it  is  tolerably  safe  to  trust  to. 

Our  miners  understand  that  silver  is  of  constant,  steady, 
and  moderate  supply;  keeping  pace  with  the  world's 
expanding  industry,  and  no  more.  They  understand  that 
gold  is  of  inconstant,  fluctuating,  and. either  superabund- 
ant or  inadequate  supply;  and  they  have  no  fears  as  to  the 
marketability  of  their  silver  product. 

The  question  before  us  is  therefore  not  one  of  favor  or 
advantage  to  any  industry,  even  though  that  industry  be 


107 

largely  American  aud  of  a  nature  and  importance  that 
should  command  for  it  every  advantage  which  legislation 
could  confer. 

RESTOKATION   OF   THE   DOUBLE   STANDARD  A  NATIONAL  AFFAIR. 

The  question  is  one  of  advantage  to  the  nation,  to  soci- 
ety, to  the  world  at  large.  It  has  to  deal  not  only  with 
the  industrial  interests  of  to-day,  but  of  all  time.  It  is  the 
question  of  the  measure  which  shall  be  applied  not  only  to 
the  labor  of  the  present  time,  but  to  the  labor  of  all  time 
past,  the  labor  of  all  time  to  come.  It  proposes  to  goage 
this  labor  by  the  measure  which  has  guaged  it  forever — by 
the  guage  that  can  measure  it  most  fairly  and  equitably; 
by  the  only  guage  that  can  truly  measure  it  at  all — to  wit, 
the  double  standard  of  gold  and  silver.  It  is  opposed  to  the 
impracticable  project  of  measuring  it  by  a  new  and  smaller 
measure;  by  an  inconstant,  a  fluctuating,  a  monopolized 
measure.  This  is  the  nature  and  magnitude  of  the  ques- 
tion before  us;  a  question  to  the  elucidation  of  which  the 
most  intellectual  men  of  all  nations  and  in  all  times  have 
largely  devoted  their  attention ;  a  question  which  lies 
down  at  the  ver}^  basis  of  property,  of  industry  and  of 
progress ;  a  question  which  not  only  affects  the  wealth  of 
nations,  the  rank  of  nations,  the  welfare  of  nations,  but 
the  very  conditions  of  social  existence  itself. 

It  is  too  large,  it  is  too  grand  a  question  to  be  belittled 
by  any  such  vulgar  and  familiar  approaches  as  have,  I  re- 
gret to  say,  been  made  toward  it  by  one  or  two  gentlemen 
who  have  alluded  to  the  subject  in  the  House  of  Repre- 
sentatives. Fifty  centuries  of  the  world's  accumulated 
wealth  are  before  us  to  be  answered  in  our  deliberations 
upon  this  question ;  fifty  centuries  of  mute,  but  colossal 
interrogatories;  fifty  centuries  of  trial,  of  suffering,  of  toil, 
of  conflict,  of  ever  perishing  and  ever  renewing  human 
life,  every  element  of  which  has  contributed,  one  way  or 
another,  to  mould  the  ponderous  scale  of  the  precious  met- 
als in  which  the  work  of  the  world  is  measured,  and  which 
some  madmen  would  raise  their  Vandal  hands  to  destroy. 

These  men  are  chiefly  the  plutocrats  of  England  aud 


108 

Germany.  They  want  the  debts  which  the  nations  of  the 
earth  owe  to  them,  and  which  were  made  in  Manchester 
cottons  and  Birmingham  wares,  to  be  paid,  not  in  the  base 
currencies  in  which  they  were  nominally  or  really  engen- 
dered— not  even  in  good  money,  in  gold  and  silver,  which 
is  the  money  of  the  world,  and  has  been  so  for  all  time — 
but  in  that  particular  metal  which  they  have  observed  is  for 
the  time  diminishing  in  supply  and  daily  becoming  more 
difficult  and  expensive  to  purchase.  To  accomplish  this 
object  they  are  ready  to  revolutionize  the  currency  of  the 
world ;  to  help  demonetize,  and  advise  others  to  help  de- 
monetize, a  stock  of  over  $2,000,000,000  of  silver,  the  pre- 
cious moiety  of  the  world's  standard  of  values,  stored  up 
from  the  ages,  and  in  its  place  to  set  up  their  own  moon- 
calf of  gold,  recking  not  how  much  suffering  the  inadequate 
substitution  will  occasion. 

LET  ENGLAND  AND  GERMANY  ADHERE  TO  THE  GOLD   STANDARD 

IF  THEY  WILL. 

The  worst  punishment  which  can  befall  this  reckless  tri- 
fling with  the  interests  of  society,  is  that  which  it  itself  in- 
vites, and  which  must  beftiU  it  if  the  rest  of  the  world  refuses 
to  take  part  in  such  trifling.  By  leaving  England  and  Ger- 
many to  the  enjoyment  of  their  self-erected  standard  of  gold, 
it  would  result  in  the  end  that  gold  would  become  cheaper 
in  those  countries  than  elsewhere  and  prices  would  rise 
therein.  The  co-ordinate  use  of  silver  with  gold  in  the  rest 
of  the  world  would  tend  to  drive  gold  into  England  and 
Germany,  where  it  would  accumulate  and  become  cheap. 
Gold  would  inevitably  flow  into  the  countries  where  it  was 
most  in  demand,  viz:  England  and  Germany,  just  as  now 
silver  flows  into  Asia.  And  as  silver  has  accumulated  in 
Asia  and  enhanced  the  prices  of  commodities  and  services 
in  that  portion  of  the  world,  so  would  gold  accumulate  in 
England  and  Germany  and  enhance  the  prices  of  commod- 
ities and  services  there.  When  this  happened,  and  the 
plutocrat  perceived  that  his  fund  or  his  income  of  gold 
would  purchase  less  of  other  men's  labor  than  before,  his 


109 

punishment  will    have  arrived,  and  richly  will   he   have 
deserved  it. 

"What  will  then  be  his  resource,  his  only  resource  from 
the  loss  of  purchasing  power  ?  The  same  resource  to  which 
his  narrow  selfishness  has  always  instinctively  led  him :  that 
of  endeavoring  to  change  the  standard  to  the  dearer  metal, 
which  will  then  be  silver.  He  will  then  have  to  purchase 
his  silver  from  us,  as  he  now  asks  that  we  shall  purchase 
his  gold  from  him,  and  we  shall  be  able  to  fix  as  high  a 
price  upon  silver  as  he  would  now  fix  upon  gold. 

TO    ADHERE   TO  THE    GOLD    STANDARD  IN   THE  UnITED    StATES 
IS   TO    GRATUITOUSLY    ENHANCE   THE    MORTGAGES  UPON    THE 

NATION. 

The  true  meaning  of  the  sinister  advice  which  we  receive 
from  this  class,  is,  that,  by  adopting  the  gold  standard,  we 
should  gratuitously  and  needlessly  enhance  the  value  of  the 
mortgages,  which,  in  the  shape  of  Government  bonds,  they 
hold  upon  the  industries  of  this  country.  We  are  not 
ashamed  of  these  mortgages.  Though  they  were  given 
for  inadequate  consideration,  yet  they  were  given  in  a 
time  of  peril  and  uncertainty.  We  have  not  the  slightest 
intention  to  repudiate  them.  We  have  already  paid  upon 
them  in  interest  vastly  more  than  their  entire  face,  and 
shall  continue  to  pay  this  interest  promptly  and  as  fast 
as  it  comes  due.  But  while  it  is  neither  to  our  taste,  (for 
we  are  a  proud  nation,  and  disdain  to  submit  our  honor 
to  the  scant  measure  of  a  doubtful  law)  nor  to  our  inter- 
est, to  repudiate  our  obligations,  we  do  not  propose  to  go 
beyond  the  limit  which  our  organic  laws  have  set  to  the 
standard  in  which  debts  shall  be  paid.  We  do  not  pro- 
pose, by  resuming  specie  payments  in  gold,  to  increase 
the  demand  for  and  purchasing  power  of  gold,  and  thus 
enhance  the  value  of  the  mortgages  upon  our  industry. 
The  law  of  this  country  made  our  standard  the  bi-metallic 
one  of  gold  and  silver.  This  is  not  only  the  law  of  the 
United  States;  it  is  the  law  of  nations;  the  law  of  ages; 
the  law  of  the  World.     We  refuse  to  be  led  up  and  down 


110 

hill,  first  into  one  standard  and  then  into  the  other,  at 
the  heck  of  a  short-sighted  and  selfish  class  of  men,  to 
whom  the  world  owes  no  debt  of  gratitude.  We  refuse  to 
pull  up  and  destroy  our  ancient  moorings.  We  refuse  to 
part  with  the  ages  and  with  the  rest  of  the  world,  to  which 
both  our  present  and  our  future  interests  unite  us;  to  the 
rest  of  Europe;  to  South  America,  to  Africa,  and  to  Asia. 
We  propose  to  stand  where  we  have  always  stood ;  where 
the  nations  stand;  where  stands  the  world;  we  propose  to 
stand  on  the  double  standard;  the  standard  of  the  popula- 
tions; the  standard  wliich  the  natural  fitness  and  general 
distribution  of  the  precious  metals  has  indicated  to  be  the 
only  safe  one. 

GOLD  AND  SILVER    MINING   UNPROFITABLE,  AND  TO  INTERRUPT 

IS  TO  DESTROY  IT. 

There  is  2rreat  dansrer,  I  miarht  even  without  exasrocer- 
ation  say,  appalling  danger,  in  abandoning  the  double 
standard.  This  arises  from  the  fact  that  the  mining  of  the 
precious  metals  is,  on  the  average,  always  conducted  upon 
the  verge  of  loss.  Therefore  the  moment  you  demonetize 
one  metal  3'ou  temporarily  cheapen  it,  and  help  to  throw 
it  out  of  production.  To  stop  production  is  the  work  of 
an  instant,  to  reinstate  it  again  is  the  work  of  years ;  and 
when,  as  is  bound  to  be  the  case,  the  discarded  metal  is 
once  more  in  demand,  it  is  the  work  of  long  time  to  obtain 
sufficient  supplies  of  it  again.  We  know  that  in  the  case 
of  the  Siberian  gold  mines  over  three  thousand  years 
elapsed  between  the  time  of  their  abandonment  (by  the 
Persians)  and  reoccupation  (by  the  Russians) ;  in  the  case  of 
the  Spanish  silver  mines  fifteen  hundred  years  ;  in  the  case 
of  the  Mexican  silver  mines,  during  the  first  half  of  this 
century,  some  twenty  or  thirty  years.  It  matters  not  what 
the  cause  of  those  several  abandonments  was;  whether  it  was 
wars,  or  the  insufiiciency  of  known  mechanical  resources, 
or  trifling  with  the  standard.  It  is  sufi&cient  if  we  know 
that  no  matter  what  cause  put  an  end  to  the  production  of 
the  metals,  the  most  urgent  after  demand  for  the  aban- 


Ill 

cloned  metal  was  inadequate  for  a  long  period  to  stimulate 
its  reproduction. 

When  mines  are  abandoned,  water  flows  into  them  and 
fills  them  up;  earth,  stones,  and  otiier  debris  clog  and 
choke  them,  and  frequently  bury  them  up  out  of  sight  and 
even  remembrance;  the  supporting  timbers  of  galleries 
rot  away,  the  galleries  themselves  fall  in ;  and  these  cir- 
cumstances often  render  it  practically  impossible  to  reopen 
the  mines.  And  you  cannot  find  silver  and  gold  mines  at 
pleasure,  as  you  can  wheat  fields  or  suitable  sites  for  mills 
or  manufactories.  The  whole  surface  of  Central  America 
and  California,  and  the  Sierra  Nevadas  has  been  ripped 
and  torn  up  in  the  search  for  the  precious  metals.  The 
valleys  have  been  explored,  the  streams  turned  from  their 
natural  courses,  the  hills  washed  away  with  artificial  hy- 
draulic power,  the  mountains  honey-combed  with  shafts 
and  tunnels,  Not  a  district  has  been  left  undisturbed. 
The  Pacific  coast  of  America  has  been  ransacked  ip  modern 
days  even  more  thoroughly  than  were  Northern  Africa  and 
the  Spanish  Peninsula  in  ancient  days;  for  this  ransacking 
has  been  done  by  the  hardiest  among  the  foremost  races  of 
the  world. 

But  in  the  exploration  of  natural  resources  man  has  no 
pity  for  Nature  or  posterity.  He  exploits  the  land  in  the 
pursuit  of  agriculture  as  our  Virginian  forefathers  did  the 
noble  valleys  of  the  Atlantic  coast  in  the  cultivation  of 
tobacco;  as  the  planters  of  the  cotton  States  did  the  table 
lands  of  Georgia  and  Alabama  and  the  bottom  lands  of 
Mississippi  in  the  cultivation  of  cotton;  as  the  western 
men  are  now  doing  the  richly-wooded  lands  of  their 
country,  for  the  sake  of  the  timber  which  stands  upon 
them.  In  a  similar  way  have  the  Pacific  States  been  ex- 
ploited for  mines. 

There  are  probably  but  few,  of  even  measuredly,  rich 
deposits  left  to  discover.  The  most  that  we  can  henceforth 
do  is  to  exhaust  what  have  been  found.  There  are  no 
more  great  bonanzas  in  the  the  Sierra  Nevadas  ;  probably 
there  are  not  elsewhere  in  the  world  deposits  of  ore  of 


112 

such  magnitude.  I  do  not  mean  deposits  found  ;  I  mean 
found  or  unfound.* 

Already  many  of  the  less  profitable  silver  mines  of  the 
world  have  ceased  to  be  worked.  The  slight  and  tem- 
porary fall  in  silver,  occasioned  by  the  partial  demonetiza- 
tion of  the  metal  in  Europe,  its  prospective  practical 
demonetization  in  this  country,  and  the  hitherto  abundant 
yield  of  the  bonanza  mines,  have  been  sufficient  to  throw 
many  of  the  poorer  paying  silver  mines  of  the  world  out  of 
production. t 

By  resuming  specie  payments  in  this  country  upon  the 
basis  of  the  fatally  erroneous  law  of  1873  we  would  render 
practical  and  immediate  that  demonetization  of  silver 
which,  as  yet,  while  paper  notes  form  nearly  the  entire 
circulating  media  of  the  country,  is  but  prospective,  and 
therefore  not  practical.  More  than  this  :  the  example  of  so 
great  a  country  as  the  United  States  vT-ould  be  apt  to  lead 
other  countries  into  the  same  erroneous  way,  and  silver 
would  soon  become  entirely  demonetized  in  the  Occidental 
world. 

*It  must  always  be  borne  in  mind  that  the  order  of  progress  in  mining 
is  from  the  poor  to  the  richer,  just  as  the  venerable  and  celebrated  Henry 
C.  Carey  has  shown  it  to  be  in  agriculture.  This  order  of  progress  in 
mining  results  from  the  fact  that  men  always  seek  first  the  most  easily 
accessible  sources  of  production.  When  the  ontcroppings  of  a  great 
mine  are  discovered  it  is  rare  tliat  exploration  proceeds  further  than  a 
few  hundred  feet  beneath  the  surface  where  the  ore  lies  in  widespread 
lenticular  masses.  Then  comes  the  "barren  zone,"  which  is  seldom 
explored  at  first.  The  richer  but  fewer  deposits  of  ore  below,  the  great 
bonanzas,  concentrate  in  perpendicular  veins  far  apart,  and  are  never 
reached  except  at  gi'eat  outlay  and  expense,  and  as  tlie  result  of  organ- 
ized and  scientific  mining.  Whoever  is  fortunate  enough  to  strike  one 
of  these  bonanzas  makes  great  profit  from  it,  whilst  the  others  sustain 
loss,  and  on  the  whole  the  product  of  metal  is  diminished. 

I  This  fact  is  not  only  deducible  from  the  statistics  of  the  World's  annual 
yield  of  silver  given  above,  but  it  has  come  under  my  own  observation 
that  man}''  of  the  low  grade  ore  deposits,  even  of  the  Comstock  lode,  have 
either  been  abandoued  or  soon  will  be  abandoned.  These  low  grade  mines, 
though  fully  provided  with  shafts,  adits,  railways,  engines,  mills,  etc. 
which  were  profitably  employed  while  silver  bore  a  higher  price  in 
market,  are  being  abandoned,  the  improvements  put  upon  them  are  lost, 
and  great  numbers  of  miners  have  been  thrown  out  of  employment. 


113 

Did  gold  promise  to  continue  in  very  abundant  supply 
the  ruinous  consequences  of  this  error  might  to  some  ex- 
tent be  mitigated;  though  under  no  circumstances  could 
they  be  entirely  mitigated,  owing  to  the  always  fluctuating 
nature  of  gold  supplies.  But  even  this  degree  of  mitiga- 
tion is  not  to  be  expected.  Gold  is  so  far  from  being  pro- 
duced throughout  the  world  in  great  abundance,  that  the 
present  annual  product  is  dangerously  insuflicient,  and  even 
this  supply  is  declining.  "We  are  invited  to  abandon  a  good 
ship  and  enter  a  sinking  one;  to  desert  solid  ground  and 
stand  upon  a  quagmire;  to  renounce  a  system  which  has 
stood  the  test  of  centuries,  and  adopt  one  which  has  been 
tried  but  by  a  single  nation,  England,  and  that  only  since 
1816,  or  rather  from  1824  to  1848,  and  at  the  expense  of 
retarding  and  crushing  the  prosperity  of  her  industrial 
classes  during  the  period  of  such  trial. 

I  have  said  that  the  mining  of  the  precious  metals  is 
always  conducted,  on  the  average,  upon  the  verge  of  loss. 
This  statement  is  supported  by  all  writers  upon  the  subject. 

The  ready  marketability  of  the  precious  metals,  a  fact 
which  renders  the  product  of  the  miner's  labor  available 
on  the  instant,  forms  a  strong  inducement  to  their  produc- 
tion, and  the  competition  is  so  great  as  to  push  the  pro- 
duction to  the  verge  of  loss,  perhaps  even  beyond  it.  The 
moment  you  destroy  or  impair  this  marketability  of  the 
precious  metals,  as  you  do  by  demonetizing  silver,  you 
diminish  the  production.  You  could  not  do  the  same 
with  wheat  or  other  commodities.  Upon  these  the  laws 
confer  no  privilege  of  marketability;  they  are  not  legal 
tender  for  the  payment  of  debts.  Their  production,  there- 
fore, never  ventures  beyond  the  area  of  profit — I  mean,  of 
course,  profit  on  the  average.  Present  and  future  demand 
alone  regulate  their  supply.  It  is  not  the  same  with  the 
precious  metals.  Their  supply  has  reference  to  the  past 
as  well  as  the  present  and  future.  There  is  a  stock  of 
these  metals  in  the  world  which  has  come  down  to  us  from 
the  earliest  ages  of  history,  and  every  additional  ounce  pro- 
duced, aflects  this  stock.  There  is  no  similar  stock  of  any 
8 


114 

other  commodities.  Even  arable  lands  and  stone  edifices 
fail  to  escape  the  ravages  of  time.  With  metal  produced 
to-day  you  can  discharge  obligations  for  commodities  and 
services  sold  or  rendered  years  ago.  You  cannot  do  the 
same  with  wheat  or  any  other  commodities.  Why  ?  Be- 
cause the  laws  make  the  precious  metals  legal  tenders  for 
the  payment  of  debt.  You  cannot  force  a  creditor  to  re- 
ceive payment  in  wheat  or  lands,  but  you  can  force  him 
to  accept  payment  in  money.  Hence  the  superior  market- 
abilit}'  of  the  precious  metals — a  marketability  which  is 
due,  in  the  first  place,  to  their  intrinsic  qualities  of  supe- 
rior homogeneity,  divisibility,  re-unitability,  portability, 
etc.,  and  in  the  second  place  to  the  law. 

If  you  impair  this  marketability  by  demonetizing  one 
of  the  metals,  you  reduce  it  to  the  same  rank  as  any  other 
commodity,  to  the  rank  of  commodities  which  are  produced 
only  when  such  production  is  profitable.  You  will  not 
destro}'  the  production  of  the  demonetized  metal.  Far 
from  it.  The  precious  metals  are  too  valuable  for  a  great 
variety  of  industrial  purposes.  They  will  still  continue  to 
be  produced,  only  the  quantity  produced  will  be  less;  and 
after  the  stock  of  demonetized  coin  shall  be  absorbed  irre- 
trievably into  the  arts,  the  price  will  be  higher.  Why? 
Because  the  production  of  the  metal  will  only  be  continued 
where  it  proves  profitable.  The  supply  will  become  regu- 
lated by  the  present  and  future  demand.  Rather  than  push 
the  production  of  the  metal  to  the  verge  of  loss,  men  will 
prefer  to  engage  in  some  other  occupation.  The  price  will 
not  only  rise  on  account  of  diminished  production,  but 
also,  and  chiefly,  because  the  producer  will  demand  in  it  a 
profit,  ]^ow  he  does  not;  he  cannot.  The  competition  is 
too  keen  to  admit  of  profit.  The  production  of  the  precious 
metals  is  perhaps,  even  on  the  whole,  a  constant  source  of 
loss.  Still  men  will  engage  in  it,  not  only  on  account  of 
the  occasional  fortunate  and  unexpected  prizes  which  it 
yields,  and  which  is  the  same  in  diamond  washing  and 
pearl  fishing,  but  also  because  of  the  superior,  the  instant, 
marketability  of  the  product.  This  instant  marketability 
is  due  in  part  to  the  law.     It  enables  the  gold  or  silver 


115 

r 

miner  to  realize  the  product  of  liis  labor  at  once.  It  in- 
duces him  to  make  the  most  of  that  labor;  it  leads  him  to 
overwork;  and  eventually  it  destroys  him.  The  valleys  of  El 
Dorado  are  strewn  with  the  wrecks  of  human  lives,  wrecks 
which  lie  bleaching  in  the  sun  to  warn  away  the  newcomer. 
But  they  warn  in  vain  ;  and  tlie  production  of  the  precious 
metals  contitmes  in  spite  of  loss,  and  sickness,  and  pre- 
mature death.  Conducted  at  this  great  sacrifice,  eon- 
ducted  thus  always  upon  the  verge  of  loss,  and  perhaps 
beyond  it,  the  moment  the  production  of  the  precious 
metals,  or  either  of  them,  is  discouraged  by  demonetization, 
from  that  moment  it  sinks  to  the  rank  of  all  other  com- 
modities and  demands  a  profit  in  its  price.  Suppose  you 
der^nonetize  silver,  and  thus  limit  its  production  to  the  ex- 
tent of  the  demand  for  it  in  the  arts  ;  and  when  the  stock  of 
silver  coin  becoaies  melted  up  and  absorbed,  as  it  soon 
would  be,  you  discover,  as  you  will  be  sure  to  discover,  that 
you  have  made  a  mistake:  at  what  price  is  it  imagined  can 
this  silver  be  repurchased?  At  15  for  1  of  gold?  At  12  for 
1,  10  for  1,  8,  for  1?  I  fanc}^  not.  Gold  was  demonetized 
in  Japan,  and  not  more  than  twenty-five  years  ago  it  could 
be  purchased  in  that  country  at  four  times  the  price  of 
silver.  Later  on  they  re-monetized  gold  in  that  country, 
and  were  obliged  to  purchase  it  at  the  rate  of  1  for  15^  ol' 
silver. 

Had  Japan  not  been  a  country  at  that  period  very  back- 
ward in  civilization,  divided  into  great  feudatories,  whose 
tributes  and  rents  were  payable  in  grain,  the  difficulty  of 
again  monetizing  the  discarded  metal  would  have  been 
insuperable.  Even  as  it  was,  the  measure  was  accom- 
panied by  a  violent  social  revolution  and  the  entire  destruc- 
tion of  the  existing  system  of  government. 

Are  you  prepared  to  hazard  an  experiment  of  this  char- 
acter? For  the  sake  of  pursuing  the  idle,  mischievous 
theory  called  monometalism,  urged  by  an  interested,  self- 
ish, and  shortsighted  class  of  men  in  England  and  Ger- 
many, and  indorsed  by  certain  flippant  and  conceited 
writers  on  political  economy,  are  you  ready  <"o  invoke  the 
tremendous  risk   of  banishing  a  metal  which   constitutes 


116 

one-half  of  the  world's  stock  of  money,  and  which,  if  once 
banished,  can  never  be  recalled  without  the  propitiating 
sacrifice  of  all  vested  interests,  of  all  existing  relations  of 
property,  of  all  the  institutions  of  society?  The  great  in- 
stitution of  Japan  was  the  feudal  system,  and  the  moment 
she  opened  herself  to  the  influence  upon  prices  and  rela- 
tions which  was  exercised  by  the  precious  metal  which  she 
had  previously  forbidden  to  compose  part  of  her  standard, 
that  great  institution  was  shivered  to  atoms.  The  great 
institution  of  the  United  States  is  popular  suffrage.  Are 
we  prepared,  by  abandoning  the  olden  way,  the  double 
standard,  and  exposing  ourselves  to  the  social  revolution 
which,  after  abandoning  that  standard,  would  inevitably 
accompany  its  re-establishment — are  we  prepared  to  see 
our  great  institution  shivered  to  atoms,  too  ? 

It  cannot  be  doubted  that  resumption  in  specie  and  lim- 
itation to  the  single  gold  standard  would,  in  time,  produce 
these  alarming  results.  But  we  are  not  a  people  who 
would  open  the  door  to  such  consequences.  TVe  would 
endeavor  to  obviate  them.  And  the  only  way  to  obviate 
them  would  be  to  go  on  with  irredeemable  paper,  with 
violent  abberrations  of  prices,  with  bankruptcies,  and  with 
the  pandemonium  of  the  stock  exchange. 

THE  DOUBLE  STANDARD  WILL  HAVE  TO  BE  RESTORED. 

There  are,  perhaps,  those  who  do  not  perceive  any  rea- 
son which  would  compel  a  nation  to  return  to  the  double 
standard  after  having  abandoned  it.  These  reasons  have 
already  been  given,  and  I  regard  them  as  unanswerable. 
Thev  are : 

1.  The  insufficient  stock  of  gold  in  the  world  to  effect 
its  exchanges  without  a  great,  rapid,  and  overwhelming 
fall  in  prices  to  one-half  of  present  prices  in  specie. 

2.  The  insufficient  annual  supplies  of  gold;  there  not 
being  more  than  enough  produced  to  supply  the  arts  and 
maintain  the  stock  of  coin. 

3.  The  fluctuating  nature  of  gold  production,  which 
would  give  rise  to  violent  aberrations  of  prices  from  time 
to  time. 


117 

4.  The  monopolization  of  the  supply  of  gold,  whicli  now 
is  chiefly  from  countries  covered  by  the  British  flag. 

And  many  other  reasons,  which  these  few  will  serve, 
perhaps,  to  recall. 

When  the  tremendous  decline  and  violent  fluctuations 
in  prices  which  must  accompany  a  single  gold  standard, 
have  worked  as  much  ruin  and  destruction  of  existing 
relations  as  the  nation  will  bear,  the  revulsion  in  favor  of 
again  monetizing  silver  will  be  too  great  to  resist:  yet 
re-monetization  may  have  to  be  efl:ected  in  the  face  of 
difiiculties  and  dangers  quite  as  great  as  those  from  which 
escape  is  sought  to  be  made.  It  would  be  Charybdis  on 
one  side;  Scylla  on  the  other;  mischief,  danger,  ruin  on 
both. 

At  the  bottom  of  this  dangerous  effort  to  abolish  the 
double  standard  of  this  country,  lies  nothing  but  selfish- 
ness and  injustice — the  selfishness  of  a  class  who  desire 
to  receive  payment  for  debts  and  obligations  in  a  met»I 
which,  for  the  moment,  and  at  the  mean  natural  relation 
is  a  few  per  cent,  dearer  than  the  other. 

SOCIETY  CAN  ONLY  BE  RULED  WITH  EQUITY — THE  GOLD  STANDARD 

INEQUITABLE. 

Opposed  to  the  consummation  of  this  injustice,  not  only 
does  all  Nature  array  herself,  but  so  also  do  the  unconscions 
instincts  of  humanity,  the  occult  working  of  social  insti- 
tutions. Consummate  it,  if  you  can,  and  you  will  have 
poverty,  distress,  commotion,  and  perhaps  revolution. 
Having  consummated  it,  try,  then,  to  undo  it,  and  you 
will  find  the  task  beset  with  great  difiiculties. 

Neglected  dislocations  of  the  human  frame  are  ditficult 
to  remedy;  because  the  wrenched  member  finds  for  itself 
a  new  socket.  The  dislocation  of  the  social  fabric  which 
threatens  to  result  from  the  effects  of  the  act  of  1873  may 
yet  be  averted  by  the  timely  measure  of  restoring  the 
double  standard  before  we  attempt  to  resume  specie  pay- 
ments. 

You  cannot  expect  to  take  a  nation  by  the  throat,  hold 
it  down,  squeeze  the  last  drop  of  substance  out  of  it,  no 


118 

matter  in  what  sacred  name,  wliether  of  Honor  or  Justice, 
without  running  the  risk  of  being  taken  by  the  throat 
vonrselves.  No  matter  how  cunning  the  injustice  is,  it  is 
sure  to  be  found  out  when  it  comes  to  work,  and  sure  to  be 
avenged  when  it  is  found  out.  All  the  interests  of  s(K*iety, 
even  the  safety  and  permanence  of  vested  interests,  demand 
the  exercise  of  equity  in  the  affairs  of  government;  and  I 
teH  those  who  represent  such  interests  that,  in  the  long  run, 
they  will  best  consult  their  advantage  in  being  just  at  the 
outset.  They  have  got  the  people  of  this  country  by  the 
throat  in  the  ambiguously  worded  act  of  February  25, 
1862.  They  pinned  the  people  down  by  the  coin-paying 
act  of  March  18,  1869,  and  now  they  would  squeeze  the 
last  drop  of  substance  out  of  them  by  the  single  gold  stand- 
ard act  of  February,  1873,  which  they  propose  to  carry 
into  eiFect  by  the  Kesumption  Act  {a  very  proper  act  of  itself) 
of  1875.  And  now  ray  advice  to  them  is,  to  stop  and  undo 
the  worst  part  of  their  work,  by  repealing  so  ranch  of  the 
act  of  1873  as  prevents  the  silver  dollar  frora  being  ten- 
dered for  the  payment  of  debts.  The  people  have  paid 
their  full  ransom  to  Brennus ;  let  him  not  attempt  to  over- 
load the  scale  with  the  weight  of  his  sword,  or  they  raay 
take  it  up  and  use  it. 

OUR  COMMERCE  WITH  ASIA    DEPENDS  UPON  THE  DOUBLE  STAND- 
ARD. 

Turning  from  these  considerations  of  danger  in  abolish- 
ing the  double  standard  to  those  of  profit  and  advantage 
in  retaining  it,  perrait  rae  to  call  your  attention  to  the 
influence  which  this  subject  is  destined  to  exercise  upon 
our  commerce. 

It  has  been  the  interest  in  all  ages  of  certain  classes  to 
deny  that  Commerce  is  beneficial,  and  that  agriculture  and 
manuftictnres  or  mining  are  alone  entitled  to  political  con- 
sideration ;  but  such  a  position  is  utterly  untenable.  Pro- 
duction cannot  advance  beyond  the  rudest  limits  without 
commerce,  whose  essential  function  it  is  to  exchange  that 
which  is  not  needed,  for  that  which  is,  or,  to  reraove  com- 
modities from  places  where  they  are  not  wanted,  to  places 


119 

where  they  are.  In  fact,  commerce  is  inseparably  bound 
up  with  production  ;  there  is  no  actual  dividing  line  be- 
tween them.  The  carriage  of  seeds  to  be  planted,  of  textiles 
to  be  woven,  of  ores  to  be  smelted,  and  the  removal  of  the 
results  to  places  of  deposit  or  consumption,  are  all  com- 
mercial functions.  Foreign  commerce  is  in  like  manner 
inseparable  from  production,  and  forms  part  of  it.  The 
implements,  materials,  agencies,  and  even  remoter  sources 
of  national  productive  industries,  depend  upon  foreign 
commerce,  and  would  perish  without  it.  Commerce  has 
exercised  a  potent  influence  in  propagating  and  extending 
religion.  In  its  train  have  ever  followed  opulence,  national 
strength,  political  liberty,  letters,  arts,  and  sciences.  Its 
advance  has  always  been  marked  by  a  general  progress  in 
the  condition  of  men;  its  retardation  })y  a  corresponding 
retrogradation  ;  and  its  discouragement  or  decline  by  pov- 
erty, national  dissolution,  tyranny,  slavery,  ignorance,  and 
crime.  It  has  destroyed  tlic  barriers  of  distance,  alienage, 
race,  religion,  and  caste.  It  has  equalized  the  conditions 
of  life  in  various  parts  of  the  earth,  and  tended  to  promote 
that  homogeneousness  of  the  human  race  which  the  pro- 
foundest  thinkers  have  maintained  is  au  indispensable 
preliminary  to  its  highest  development. 

Asia  Major,  with  the  products  of  its  varied  climes  and  its 
teeming  populations  of  Tartary,  Persia,  India,  China,  and 
Japan,  has  in  all  ages  been  the  objective  point  of  com- 
merce, and  the  nations  who  found  the  best  route  to  it, 
have,  in  turn,  all  held  the  sceptre  of  commercial  greatness. 
The  Phoenicians  opened  a  route  (not  the  ancient  canal  of 
Necho)  to  Asia  by  way  of  Suez;  the  Hebrews,  overland, 
by  way  of  Palmyra  or  Tadmor.  The  Suez  route  was  re- 
opened by  the  Greeks  and  successively  kept  open  by  the 
Romans  and  Venetians.  The  Genoese  penetrated  to  Asia 
by  way  of  the  Euxine;  the  Portugese  led  the  way  by  the 
Cape  of  Good  Hope;  the  Hansards  opened  an  overland 
route  by  way  of  Novgorod;  Spain  sought  for  a  path  west- 
ward and  stumbled  upon  a  New  World;  England  discov- 
ered a  route  by  way  of  Cape  Horn,  and  America  has  paved 
with  iron  rails,  first  one  route  by  way  of  Panama  and  after- 


120 

ward  another  da  Sau  Fraiicisco.  France  has  acquired  both 
glory  and  profit  by  reopening  the  long-abandoned  Suez 
canal  of  the  Egyptians;  Enghmd  has  reawakened  the 
commercial  hopes  of  her  statesmen  by  purchasing  a  large 
interest  in  this  canal;  the  Medieval  prosperity  of  Italy  has 
been  revived  through  her  proximity  to  it;  and  Russia  is 
exciting  the  jealousy  of  England  by  extending  her  borders 
and  military  posts  to  the  northwestern  limits  of  India. 

The  commercial  diadem  of  the  world,  the  commerce  with 
Asia,  lies  within  easier  grasp  of  the  United  States  than  that 
of  any  other  nation,  of  the  Occident.  We  not  only  possess 
the  two  shortest  or  best  routes  to  the  Orient,  those  by  way 
of  Panama  and  San  Francisco;  we  are  not  only  in  fact  the 
next-door  neighbor  to  Japan  and  China,  stretching,  as  our 
possessions  do,  within  sight  of  Kamskatka  and  holding 
almost  the  entire  shores  of  the  northeastern  Pacific ;  we 
are  not  only  at  peace  with  Asia,  and  regarded  by  her  with 
more  friendliness  than  any  other  nation — we  possess  that 
commercial  object  for  which  Asia  is  as  anxious  to  seek  the 
Occident  as  we  are  the  Orient  for  tea,  spices,  and  silk. 
We  are  at  the  present  moment  the  largest  producers  of 
silver  in  the  world,  and  silver  is  the  main,  almost  the  only, 
object  of  foreign  commerce  to  Asiatics.  Even  yet,  al- 
though Europe  has  for  centuries  been  pouring  what  silver 
she  could  spare  into  Asia;  although  all  of  Atahualpa's 
treasures  and  almost  all  the  silver  product  of  Mexico  has 
found  its  way  to  Asia  Major,  the  price  of  agricultural  labor 
in  that  country  is  scarcely  more  than  a  penny  a  day,  and 
the  taxes  levied  by  its  monarchs  are  paid  in  rice.  These 
facts  prove  the  necessity  and  demand  for  silver  in  Asia  and 
the  comparative  scarcity  of  it  even  at  the  present  day. 

I  have  already  stated  that  it  is  estimated  that  Asia  pos- 
sessed a  stock  of  coin,  almost  entirely  silver,  amounting 
at  the  beginning  of  the  present  century  to  about  $700,- 
000,000;  in  1829  to  about  $800,000,000;  in  1848  to  about 
$900,000,000;  and  in  1872  to  about  §2,100,000,000.  A\^ith 
a  population,  stationary,  and  of,  say,  700,000,000,  this 
amounted  to  one  dollar  per  capiia  at  the  beginning  of  the 
century  and   three  dollars  per  capita  at  the  present  time. 


121 

Merely  to  keep  this  stock  of  coin  preserved  from  the  effects 
of  abrasion  and  loss,  Asia  requires  sonae  $30,000,000  in 
silver  every  year.     To  increase  it,  she  requires  more. 

Suppose  we  persist  in  demonetizing  our  silver,  suppose 
we  lessen  the  demand  for  its  use  in  the  Occident  and  help 
to  throw  upon  the  markets  of  the  world  a  stock  of  silver 
which  we  must  replace  with  a  stock  of  gold  :  is  it  not 
patent  to  the  humblest  understanding  that  we  would  lower 
its  value,  and  be  obliged  to  sell  it  to  Asia,  who,  having 
then  no  competitor  for  its  possession,  would  be  likely  to 
obtain, it  at  a  very  low  price  in  her  commodities?  Is  it 
not  plain  that  under  ^uch  circumstances,  and  for  a  long 
seriesof  years  to  come,  our  annual  product  of  silver  would 
follow  the  way  of  our  rejected  stock,  and  fall  into  the 
hands  of  the  Orient  at  a  degraded  price.  Should  we  not 
have  to  pay  more,  much  more,  than  now,  for  the  teas, 
spices,  silk,  rice,  textiles,  and  other  raw  materials  which 
we  obtain  from  that  quarter  of  the  world  ?  And  were 
we  obliged,  eventually,  as  1  believe  we  should  be,  to  buy 
back  this  thoughtlessly  demonetized  and  abandoned  stock 
of  silver,  should  we  not  have  to  purchase  it  at  a  very  high 
price,  seeing  that  meanwhile  all  prices  in  Asia  would  have 
become  greatly  enhanced  ? 

Hence  if  we  let  slip  the  present  favorable  opportunity 
to  purchase  silver  for  the  purposes  of  resumption  we  may 
find  it  very  difficult  to  do  so  in  future.  When  Occidental 
silver  once  gets  to  the  Orient  it  rarely  returns  and  it  never 
will  return  in  any  considerable  quantity  until  the  scale  of 
prices  in  the  two  great  divisions  of  the  globe  become  more 
nearly  equalized  than  they  are  at  present.  Tliis  may  be 
centuries  hence. 

Nature  has  furnished  us  with  such  advantages  for  seeking 
the  commerce  of  Asia,  advantages  of  route,  of  amicable 
relations,  of  an  ample  supply  of  silver,  that  if  we  do  not 
senselessly  throw  them  away,  we  are  almost  certain  to 
monopolize  the  Asiatic  trade  and  the  vast  profits  that 
accrue  from  its  pursuit.  Asia  stands  in  urgent  need  of 
silver;  that  silver  we  possess,  and  she  must  now  come  to 
us  for  it  and  purchase  it  from  us,  and,  as  we  can  aftbrd  t'< 


100 

sell  it  to  lier  cheaper  than  Europe  can,  h}-  the  difTeronce 
of  carriage,  insurance,  interest,  commissions,  &c.,  we  are 
almost  certain  to  secure  the  monopoly  of  her  trade  and 
with  it  a  market,  not  only  for  our  silver,  but  also  for  our 
coal  and  iron,  our  wheat  and  Indian  corn,  our  manufac- 
tures, our  literary  and  our  art  products.  And  moreover 
we  shall  inevitably  become  what  England  is  now,  the 
Occidental  world's  emporium  for  Japanese,  Chinese,  and 
East  India  products.  Instead  of  being  obliged  to  go  to 
Europe  for  these  products,  as  now,  Europe  will  be  obliged 
to  come  to  us  for  them. 

Was  it  mere  forgetfulness  or  a  perversion  of  correct 
views  which  induced  some  of  our  public  men  to  entertain 
even  for  an  instant  the  notion  of  abolishing  the  double 
standard  and  degrading  our  silver  product,  or  was  it  the 
sinister  advice  of  nations,  whose  far-seeing  commercial 
policies  detected  the  advantages  which  we  possessed  over 
them  in  the  future  rivalry  for  the  rich  trade  of  the  Orient? 

Already  has  the  partialdemonetizationof  silver  in  Europe 
had  the  effect  of  helping  to  treble  the  stock  of  silver  which 
Asia  possessed  at  the  opening  of  this  century,  and  yet  so 
small  is  the  stock  of  coin  among  Asiatic  nations  that,  if 
silver  is  not  entirely  demonetized  in  the  Occident,  there  is 
not  the  slightest  chance  that  the  surplus  silver  of  the  world 
for  centuries  to  come  will  suffice  for  the  wants  of  Asia. 
Even  with  a  partial  demonetization  of  silver  in  the  Occi- 
dent, Asia  will  be  able  to  absorb  such  portion  of  the  sur- 
plus current  supplies  of  the  world  as  can  be  spared,  as  well 
as  a  large  portion  of  the  stock,  without  being  saturated 
with  silver. 

SILVER  CANNOT  BECOME  CHEAPER  THAN  IT  IS  AT  PRESENT. 

To  those  who  indulge  the  insane  fear  that  the  late  de- 
cline  of  silver  caused  by  European  demonetization  will 
continue,  it  is  only  necessary  to  say  that  the  thing  is  im- 
possible. This  decline  cannot  continue  after  the  discarded 
stock  of  silver  is  worked  off,  and  when  the  cost  of  its  pro- 
duction again  becomes  the  principal  factor  of  its  price. 
And  should  this  country  wisely  conclude  at  this  favorable 


123 

juncture  of  affairs  to  remonetize  silver,  the  time  necessary 
for  it  to  advance  to  its  foi-nior  relation  with  gold,  would  be 
comparatively  short. 

Specie  is  too  scarce  in  China  and  India,  prices  are  too 
low,  and  the  mere  maintenance  of  their  present  stock  of 
coin  demands  a  supply  of  many  millions  a  year.  I  have 
seen  the  Humboldt,  Truckee  and  other  rivers  which  flow 
between  the  eastern  slope  of  the  Sierra  iSTevadas  and  the 
western  walls  of  the  Wahsatch,  and  which,  near  their 
sources  in  the  mountains,  flow  in  great  volume,  sink  all 
at  once  into  the  sands  of  the  desert  and  disappear  from  view 
forever.  An  attempt  to  saturate  Asia  with  silver,  would, 
to  my  mind,  be  as  successful  as  one  to  saturate  the  great 
American  desert  with  the  waters  of  these  rivers. 

But  let  us  suppose,  for  the  sake  of  argument,  that  Asia 
cannot  take  the  surplus  silver  of  the  Occidental  world  and 
demands  gold  instead  fur  the  balance  of  her  foreign  trade. 
Would  this  not  make  gold  so  scarce  as  to  force  us  of  the 
Occident  to  keep  our  own  stock  of  silver  which  we  now 
would  banish  ?  And  if  it  would  force  us  to  keep  it  then,  why 
should  we  not  keep  it  now  ?  Why  change  and  disturb  prices 
only  to  come  to  the  same  result  at  last?  Why  place  our- 
selves in  a  dilemma  either  horn  of  which  is  dangerous  ? 
Why  attempt  to  banish  silver  to  Asia  or  force  her  to  send 
it  back  to  us,  which  she  would  do  in  case  the  above  suppo- 
sition be  well  founded;  a  supposition  not  borne  out  either 
by  philosophy  or  fact. 

Banish  silver  from  the  western  world,  and  you  will  help 
to  banish  progress  with  it ;  you  will  unwittingly  and 
powerfully  assist  the  growth  and  development  of  China  and 
India  at  the  expense  of  our  own  progress,  and  precipitate  a 
monetary  i-evolution  whose  overwhelming  and  widespread 
efiects  no  man  can  fully  estimate  or  foresee. 

THE  MEXICAN  AND  CENTRAL  AND  SOUTH  AMERICAN  TRADES. 

Similar  considerations,  scarcely  less  important,  demand 
that  our  double  standard  shall  be  restored  in  respect  of 
our  commercial  and  other  relations  with  Mexico  and  Cen- 


124 

tral  and  South  America.  All  these  countries,  except  Bra- 
zil and  Chili,  have  either  the  single  silver  standard  or  the 
double  standard  of  gold  and  silver.  Omitting  Brazil  and 
Chili,  these  countries  contain  an  aggregate  population  of 
more  than  25,000,000  souls.  This  vast  population  is  at 
the  present  time  entering  upon  an  unprecedented  era  of 
activity  and  progress.  Their  trade  with  the  manufactur- 
ing States  of  the  world  belongs  naturally  and  by  reason  of 
proximity,  to  the  United  States.  Shall  we  run  the  risk  of 
losing  it  by  unnecessarily  depressing  the  quotations  of 
South  American  products  in  our  markets,  as  we  should 
do  if  we  limited  ourselves  to  a  single  gold  standard  ?  Shall 
we  offer  to  them  for  their  productions  a  stinted  measure 
of  the  metal  which  they  do  not  want,  instead  of  a  fair 
measure  of  the  metal  which  they  do  want  ?  Shall  we  force 
them  to  manufacture  for  themselves,  rather  than  purchase 
the  fabrics  they  need,  from  us,  in  exchange  for  their  val- 
uable raw  materials? 

THE  CRESCENDO  AND  DIMINUENDO  THEORY  OF  THE  ACTION  OF 

MONEY. 

I  now  come  to  those  considerations  in  reference  to  this 
subject  which  have  ever  commanded  the  most  serious 
attention  of  statesmen  and  publicists.  I  allude  to  the 
effects  of  increasing  or  diminishing  money  upon  the  social, 
moral,  and  religious  welfare  of  peoples. 

I  have  already  shown  how  profoundly  the  diminution 
of  coin  in  the  Occidental  world,  from  the  period  of  the 
Roman  empire  to  that  of  the  discovery  or  reintroduction 
of  bills  of  exchange,  affected  the  welfare  of  Igurope.  But 
as,  perhaps,  it  uuiy  be  disputed  that  the  Dark  Ages,  and 
the  awful  social  wretchedness  which  characterized  them, 
are  attributable  wholly,  or  even  in  great  part,  to  the  dim- 
inution of  money  which  occurred  during  that  period,  I 
have  deemed  it  best  to  bring  into  view  moi-o  recent  and 
familiar  eras  of  similar  character,  eras  whicli  pertain,  not 
like   the  Dark  Ages,  to   a   remote   period   and  an   entire 


125 

continent,  but  to  later  times  and  particular  countries, 
wherein  the  relation  of  the  mutations  of  the  currency  to 
the  welfare  of  the  people  is  so  close  as  to  admit  of  little 
doubt,  concerning  the  influence  and  action  of  one  upon 
tlie  other. 

I  have  already  stated  that,  from  the  nature  and  function 
of  money,  it  made  no  difference  to  the  welfare  or  conven- 
ience of  society  whether  the  total  sum  of  money  was  large 
or  small,  provided  that  it  was  neither  so  large  nor  so  small 
that  the  substance  of  which  it  was  made,  the  precious 
metals,  could  practically  be  coined  into  pieces  of  con- 
venient size  for  transportation  or  handling,  and  for  the 
transactions  of  the  ordinary  business  of  life. 

While  this  is  quite  true,  it  nevertheless  does  make  a 
most  important  difference  whether  the  sum  of  money  be 
increasing  or  diminishing.  This  diiference,  and  the  social 
phenomena  connected  with  it,  has  been  very  fitly  termed 
by  the  author  of  the  Essay  on  Currency  in  the  original 
edition  of  Johnson's  Cyclopedia,  the  Crescendo  and  Dimin- 
uendo theory,  a  phrase  derived  from  the  terminology  of 
music,  an  art  whose  terms  are  essentially  expressive  of 
movement  in  time. 

SOCIAL  EFFECTS  OF  INCREASING  AND  DIMINISHING   MONEY. 

Crescendoor  increasing,  and  diminuendo  or  diminishing,  are 
terms  which  have  been  deemed  convenient  for  the  expres- 
sion of  the  movement  of  the  stock  of  money  in  time.  While 
this  stock  is  increasing,  prices  rise;  exchange  or  commerce 
is  stimulated;  new  enterprises  are  set  afoot;  the  products 
of  agriculture,  manufactures,  and  mining  are  increased; 
the  commercial  and  industrial  classes  find  abundant  em- 
ployment, and  earn  remunerative  profits  and  wages ; 
bankruptcies  and  suicides  rarely  happen;  marriages  are 
promoted;  the  newly-born  survive  in  greater  numbers; 
population  increases  in  quicker  ratio;  letters,  the  fine 
arts,  and  the  sciences  make  most  rapid  strides;  education, 
intelligence,  morality,  and  the  observance  of  religion  are 


126 

promoted;  and  the  general  happiness  of  mankind  becomes 
greatly  enhanced. 

What  is  the  cause  of  all  this  industrial  activity  and  social 
[)rogress  ?  AVhat  action  or  influence  of  the  increasing 
stock  of  money  lies  at  the  bottom  of  it  ?  Simply  this  : 
that  an  increasing  stock  of  money  tends  to  distribute 
wealth,  and  it  is  the  distribution  of  wealth  which  effects 
these  wonderful  results.  "  Oh  !  it  is  agrarianism  or  com- 
munism that  you  propose?  You  would  go  on  increasing 
artificially  and  by  legislation  (for  it  is  only  artificially  that 
it  can  be  done)  the  sum  of  the  currency  forever,  in  order 
that  wealth  may  be  continually  distributed,  industrial 
activit}'  stimulated,  and  social  progress  promoted." 

I  propose  nothing  of  the  sort.  I  have  depicted  the  con- 
sequences of  au  increasing  stock  of  money,  not  in  order  to 
advocate  an  artificially  increasing  currency,  but  as  prelim- 
inary to  depicting  the  consequences  of  an  artificially  di- 
minishing currency,  and  with  the  view  of  warning  the 
country  against  submitting  to  any  such  diminution.  I 
do  not  propose  to  rob  the  capitalist;  but  neither  do  I  pro- 
pose to  permit  the  capitalist  to  rob  society. 

Whilrit  the  stock  of  money  is  diminishing  prices  fall; 
commerce  is  depressed;  enterprises  are  abandoned  or  ne- 
glected; industry  is  paralyzed;  itsproducts  are  diminished; 
its  supporters  defeated  in  their  just  expectations  or  thrown 
out  of  employment;  bankruptcies  anfl  forced  sales  are  in- 
creased; marriages  are  discouraged;  suicides  become  com- 
mon; the  newly-born  perish;  the  increase  of  population  is 
retarded;  the  cultivation  of  letters  is  abandoned;  the  arts 
and  sciences  fall  into  decaj-;  education,  intelligence,  moral- 
ity and  religion  are  neglected;  crime  increases;  and  general 
misery  prevails. 

What  is  the  connection  between  the  stock  of  money  and 
these  appalling  social  phenomena?  Simply  this  :  that  a 
diminishing  stock  of  money  tends  to  concentrate  wealth, 
and  the  concentration  of  wealth  is  a  cause  suflicient  to  pro- 
mote all  of  these  evils.  "  Would  3'ou,  then,  legislate  with 
the  view  of  preventing  the  stock  of  money  from   being 


127 

decreased  ?  Would  you  repeat  those  measures  of  medieval 
coercion  which  distinguished  the  reign  of  Henry  V, 
who  forbade  gold  or  silver  to  be  used  in  the  arts  in  order 
to  prevent  the  stock  of  money  from  being  diminished?" 

I  would  do  nothing  of  the  sort.  I  propose  neither  to 
increase  the  currency  by  artificial  means  nor  to  diminish 
it  by  coercion.  I  propose  to  follow  and  advocate  that 
policy  which  little  minds  never  perceive  the  advantage  of 
pursuing,  but  which  the  great  men  of  the  world  have 
recognized  to  be  the  only  safe  one  in  commercial  aflairs. 
I  propose  to  let  things  alone.  Lais  sez  fair  em  money  is  as 
important  to  the  waiX  being  of  the  world  as  laissez  faire  in 
corn. 

Is  it  not  time,  Mr.  President,  that  we  republicans,  we  the 
exemplars  of  civil  freedom  to  the  world,  should  abandon 
and  renounce  this  mischievous  policy  of  meddling  with  the 
affairs  of  commerce;  this  policy  which  has  been  handed 
down  to  us  by  the  tyrants  and  marplots  of  the  world;  the 
men  with  bloody  hands  and  the  men  with  ruthless  pur- 
poses? Is  it  not  time  that  we  practiced  freedom  as  well  as 
preached  it? 

For  five  thousand  years  has  the  world  been  amassing  a 
stock  of  gold  and  silver  money  wherewith  to  conduct  its 
comm.erce,  and  yet  in  one  instant  and  by  a  single  blow, 
would  our  irreverant  and  mischievous  hands  annihilate  one 
half  of  this  stock.  The  act  of  1873  essentially  impaired  the 
character  of  silver  as  money  in  this  country,  a  character 
which  it  did  not  owe  to  legislation,  but  to  fitness  and  im- 
memorial usage.  Could  the  act  have  afi*ected  other  coun- 
tries as  it  did  this  one  alone,  it  would  have  demonetized 
silver  throughout  the  world. 

What  is  the  principal  effect  of  demonetizing  silver?  It 
reduces  the  entire  stock  of  money  by  one-half.  This  eflect 
may  be  mitigated  by  permitting  a  small  sum  of  debased 
silver  coins,  as  tokens,  to  pass  current  for  petty  payments 
in  each  country,  but  even  then  its  chief  harm  remains.  The 
money  of  the  world  commences  to  diminish;  prices  fall; 
wealth    becomes   centralized    and    concentrated    in  a  few 


128 

hands;  property  is  sacrificed  to  pay  debts  incurred  before 
the  diminution  ;  bankruptcies  ensue;  industry'  is  petrified; 
want  and  wretchedness  stare  the  commercial  classes  in  the 
face,  and  to  escape  from  these  disasters  they  take  refuge  in 
dishonesty  and  immorality,  and  in  the  end  wind  up  with 
crime  and  destruction. 

The  evidence  of  these  deplorable  consequences  of  arbi- 
trarily diminishing  the  stock  of  money  is  to  be  found  in 
the  social  statistics  of  all  countries.  It  is  only  for  the  sake 
of  brevity  that  I  content  myself  with  adducing  a  portion  of 
those  only  of  this  country.  And  here  let  me  remark  to  the 
possible  objection  that  the  statistics  of  the  currency  of  the 
United  States  include  paper  promises,  that  the  principle  is 
the  same,  whether  the  currency  is  of  money  alone  or  money 
and  paper  combined.  So  long  as  the  promises  are  deemed 
to  be  good  enough  to  pass  current  as  money  their  efiect 
upon  prices  is  precisely  the  same.  It  does  not  follow  from 
this,  as  some  theorists  erroneously  maintain,  that  paper 
promises  would  pass  current  as  money  without  a  money 
basis.  On  the  contrary,  repeated  experience  proves  that 
they  will  not.  Nor  does  it  follow  that,  because  a  dimin- 
ishing stock  of  money  or  mixed  currency  produces  the 
evils  alluded  to  that  these  evils  can  be  avoided  by  recourse 
to  a  forced  currency  of  paper.  They  can  only  be  avoided 
by  letting  the  currency  alone,  and  the  sooner  we  learn  and 
appreciate  the  importance  of  this  great  truth  the  better  will 
it  be  for  our  country  and  the  world  at  large. 

[For  the  tables  alluded  to  in  the  text,  see  Appendix.] 

THE  AVORLd's  stock  OP  THE  PRECIOUS  METALS  THE  GREAT 
CONSERVATOR  OF  ITS  CIVILIZATION. 

It  will  perhaps  be  remarked  that,  no  statistical  evidence 
has  been  oiFeredto  support  the  assertion  made  with  regard  to 
the  eftect  of  the  movement  of  the  currency  upon  letters,  the 
arts,  etc.  The  reason  for  this  is  that,  while  statistics  have 
made  such  progress  that  they  now  fully  cover  certain  fea- 
tures of  civilization,  and  concerning  these  features  afi^brd 


129 

most  thorougli  and  convincing  testimony,  they  do  not  yet 
fully  cover  certain  other  features,  such  as  those  omitted 
from  the  illustrations  adduced.  Within  the  boundaries  to 
which  thus  far  its  conquests  have  been  confined,  the  use  of 
statistics  is  of  the  highest  importance,  to  the  student,  the 
publicist,  and  the  legislator;  beyond  that,  such  use  is 
almost  valueless,  and  want  of  discrimination  as  to  where 
to  stop  in  the  employment  of  statistical  evidence,  can  have 
but  the  single  result  of  bringing  statistics  into  undeserved 
disrepute. 

We  know  a  priori,  that  the  gradual  diffusion  of  wealth 
means  also  the  gradual  ditfusion  of  the  work  of  life,  wherein 
no  feudal  tyrant  or  merciless  plutocrat  can  lord  it  over  the 
masses  of  a  community  bound  to  exacting  toil  or  hopeless 
slavery.  It  is  only  during  this  tendency  (mark,  I  say  tend- 
ency) toward  a  distribution  of  rewards  according  to  etfort 
that  letters  and  the  arts  can  flourish.  At  all  other  periods, 
if  they  make  any  progress  at  all,  it  is  confined  to  a  few 
favored  persons,  and  soon  perishes;  for  the  acquisition 
of  letters  must  be  the  result  of  leisure  and  exemption  from 
toil,  and  the  community  that  is  bound  to  continual  labor 
can  never  hope  to  enjoy  the  fruits  of  this  divine  art. 

Therefore  such  an  increment  of  the  stock  of  money  as 
would  work  out  a  gradual  diffusion  of  wealth,  and  with 
it  the  more  equitable  distribution  of  work  and  leisure  than 
would  result  from  a  stock  of  money  which  was  decreasing 
or  stationary  while  population  advanced,  could  not  fail, 
and  it  has  never  yet  failed,  to  promote  the  progress  of  let- 
ters, the  arts  and  sciences,  morality  and  religion.  JSTor 
could  any  greater  increment  occur  than  one  which  would 
be  sufficient  to  induce  a  gradual  diffusion  of  wealth ;  that 
is,  so  long  as  the  world  retained  its  present  vast  stock  of 
the  precious  metals.  Estimating  this  stock  at  $5,700,000,- 
000,  it  requires  §85,500,000  a  year  to  keep  it  from  waste  by 
abrasion  and  loss,  and  the  annual  supply  of  the  precious 
metals  or  so  much  of  them  as  is  available  for  coin  has  rarely 
been  so  much  in  excess  of  this  sum  as  to  be  sufficient  to  pro- 
duce more  than  a  very  inconsiderable  and  gradual  diffusion 
9 


130 

of  wealth.     If  the  increase  by  population  be  considered,  the 
process  would  be  extremely  slow. 

Viewed  from  this  point,  it  will  be  seen  that  the  world's 
stock  of  the  precious  metals  has  really  been  the  great  Con- 
servator of  Civilization.  It  is  this  stock  and  its  slow  incre- 
ment since  the  sixteenth  century,  which  has  kept  prices,  on 
the  whole,  steady  and  slowly  rising;  just  as  it  was  the  decre- 
ment of  this  stock  which  threatened  the  extinction  of  civiliza- 
tion during  the  Middle  Ages.  It  was  the  little  of  it  that  sur- 
vived throughout  that  memorable  era  which  prevented  the 
total  subversion  of  society,  and  with  it  letters  and  the  arts, 
in  a  word,  civilization,  and  it  Avas  in  the  country  that  pre- 
served the  greatest  stock  of  it  during  that  period  that  civil- 
ization held  aloft  its  highest  torch.* 

THE  RESERVOIR  OF  THE  PRECIOUS  METALS. 

Lest  tliis  phrase,  "  the  great  Conservator  of  Civilization," 
sounds  too  grand,  let  it  be  supposed  that  at  the  present 
time  no  reservoir  of  the  precious  metals  existed,  or  that 
the  entire  stock  of  money  was  destroyed  in  an  instant. 
Setting  aside  the  incalculably  calamitous  consequences  of 
such  a  catastrophe,  is  it  not  plain  that  the  annual  supply 
of  the  metals,  now  amounting  to  about  one  hundred  mil- 
lions, would  assume  a  new  importance  in  the  distribution 
of  wealth  and  each  individual's  share  of  production.  As- 
suming that  the  precious  metals  would  continue  to  be  used 
for  money,  because  no  other  materials  would  answer  the 
purpose  so  well,  would  not  these  supplies,  as  fast  as  they 
came  forward,  affect  the  prices  of  commodities  and  services 
so  enormously  and  suddejily  as  virtually  to  place  society  at 
the  mercy  of  the  few  persons  who  might  be  able  to  control 
or  anticipate  such  supplies? 

*Prof.  Jolin  W.  Dt-aper,  in  his  recent  \vork  entitled  "The  Conflict  be- 
tween Science  and  Religion,"  states  that  Aluiansor,  tlie  Moorish  king  of 
Grenada,  then  the  foremost  countrj' of  Enrope  in  civilization,  population, 
and  wealth,  left  at  his  death  a  treasure  of  gold  and  silver  amounting  in 
value  to  $150,000,000.  IIow  much  of  this  sum  consisted  of  coin  is  not 
stated. 


131 

In  the  immensity  of  the  world's  stock  of  the  precious 
metals,  which  forms  a  measure  of  value  of  such  vast  pro- 
portions that  no  vicissitudes  of  production  can  sensibly 
affect  it,  society  therefore  possesses  a  guarantee  for  the 
conservation  of  all  those  institutions  upon  which  civiliza- 
tion depends;  upon  diffusion  of  wealth,  adequate  reward 
for  effort,  due  proportion  of  production,  liberty,  leisure, 
letters,  the  arts,  morality,  and  religion.  And  yet  it  is  one 
half  of  this  precious  stock  that  madmen  would  now  destroy 
or  degrade  to  the  level  of  gewgaws  and  bangles. 

In  the  face  of  the  significant  facts  which  we  have  found  to 
correspond  with  the  movement  of  the  currency,  whether  in 
the  same  is  counted  only  the  real  money  in  circulation,  or 
the  real  money  combined  with  the  credits  based  upon  it, 
(if  due  allowance  be  made  for  their  differing  ratios  of  ac- 
tivity,) I  ask  you,  are  you  prepared  to  confirm  and  ratify 
the  thoughtless  act  of  1873,  which  demonetized  silver  as  a 
legal  tender  in  the  United  States,  or  will  you  restore  that 
metal  to  its  rightful  position  in  the  money  of  the  country? 

Have  the  industrial,  the  commercial,  the  active,  the  pro- 
gressive, the  working  classes  of  the  country,  no  rights  that 
legislation  is  bound  to  respect?  What  authority  has  this 
Chamber  to  shorten  or  curtail  the  standard  by  which  their 
labor  is  to  be  measured?  What  justice,  what  wisdom, 
what  safety  is  there  in  assisting  to  destroy  the  efficiency  of 
one-half  of  the  world's  stock  of  specie,  one-half  of  that 
measure  of  value  which  has  come  down  to  us  sanctified  by 
fifty  centuries  of  toil,  of  usage,  of  experiment,  of  universal 
approval?  Can  you  look  on  with  unconcern  and  permit 
the  entire  relations  of  society  to  be  disturbed  in  the  fancied 
interests  of  that  small  class  of  persons,  who  in  every  coun- 
try are  wealthy  enough  to  monopolize  the  possession  of  its 
measure  of  value — which,  at  best,  is  limited,  and  barely 
suflicient  to  keep  pace  with  the  increase  of  population  and 
commerce  ? 

Such  is  the  pressing  scarcity  of  money,  both  of  gold  and 
silver,  throughout  the  world,  that  every  conceivable  form 
of  substitute  for  it,  both  safe  and  unsafe,  is  in  use  to  eke  it 


132 

out.  Every  country  of  the  world  is  using  credit  in  some 
form  as  a  temporary  substitute  for  money;  yet  you  would 
arbitrarily  demonetize  one-half  the  stock  of  money,  under 
the  erroneous  impression,  either  that  one  metal  is  a  measure 
of  value  less  fluctuating  than  two,  or  the  equally  erroneous 
one  that  the  option  of  two  metals  to  pay  with  is  derogatory 
to  the  rights  of  creditors  which  accrued  while  that  option 
was  open.* 

CONSTITUTIONAL  AND  LEaAL  ASPECTS  OP  THE  CASE. 

I  shall  now  endeavor  to  show  that  under  our  Constitu- 
tion both  the  precious  metals  are  made  legal  tender  for 
the  payment  of  debts. 

I  hold— 

1st.  That  the  word  "  money,"'  as  used  in  article  one,  sec- 
tion eight,  of  the  "  Constitution  for  the  Unit-ed  States," 
means  both  the  precious  metals,  silver  and  gold,  and,  by  rea- 
son of  the  context,  cannot  mean  either  paper  promises  or 
one  of  the  metals  only. 

2d.  That  the  power  to  "  regulate  the  value  thereof"  was 
necessary  in  order  to  render  this  meaning  eff^ective,  and 

*The  main  argument  used  in  favor  of  the  gold  valuation  is  this  :  ''  If 
a  creditor,  liaving  stipulated  for  a  fixed  payment,  may  be  paid  by  the 
debtor  in  either  gold  or  silver,  the  latter  chooses  tlie  material  wliich 
comes  cheapest  to  him,  and  tlie  creditor  suffers  an  injustice."  Without 
inquiring  whether  the  creditor  on  entering  upon  the  contract  also  exer- 
cised his  option  in  furnisliiug  tlie  debtor  with  either  material,  and  there- 
fore cannot  claim  anotlier  treatment — without  inquh-ing  wlietlier,  as  he 
can  also  part  with  tlie  material  received  on  the  same  terms,  and  must  do 
so,  I  can  show  you  that  the  dogma  is  one  untrue,  botli  in  practice  and  in 
theory.  *  *  *  Tlie  large  business  of  exchanging  contracts,  as  well  as 
all  such  dealings  in  capital  and  commodities,  in  which  tlic  '-creditor" 
stands  in  the  position  assumed  above,  is  carried  on  by  accounts,  checks, 
and  clearing  systems  without  the  use  of  any  currency,  and  so  the  great 
system  depends  upon  the  exchange  of  equivalents  of  value  alone.  *  *  * 
There  can  be  no  question  of  any  ditTex'ence  or  disproportionate  "cheap- 
ness" between  them,  (the  metals.)  The  debtor,  in  order  to  obtain  either 
gold  or  silver  coin,  must  render  up  the  same  equivalent  for  eitlier. 
(Ernest  Seyd,  Journal  of  the  Roj^al  Society  of  Arts,  March  10,  1S76,  p. 
320.) 


133 

that,  had  "money"  meant  one  metal  instead  of  two  the 
power  to  regalate  value  would  have  been  supererogatory, 
abortive,  and  absurd. 

3d.  That  no  other  construction  of  the  phrase  "  to  regu- 
late the  vahie  thereof"  is  admissible,  because  even  in  theory 
law  cannot  reguhite  values,  unless  the  things  whose  values 
are  to  be  regulated  are  specified,  and,  practically,  unless  also, 
the  law-power  or  Government  possesses  control  of  the  sup- 
ply or  demand  of  the  things  to  be  valued.  As  all  things 
cannot  be  specified,  and  as  Government  only  has  control 
of  the  supply  of  gold  and  silver  coins,  it  follows  that  the 
value  of  these  commodities,  one  to  the  other,  is  all  that  can 
be  "  regulated"  under  the  Constitution,  and  that  this  regu- 
lation constitutes  both  silver  and  gold  as  money  and  legal 
tender. 

I.  Article  one,  section  eight,  of  the  Constitution  for  the 
United  States  provides  that  "  the  Congress  shall  have  power 
*  *  *  *  to  coin  money,  regulate  the  value  thereof,  and  of 
foreign  coin,  and  fix  the  standard  of  weights  and  measures." 

What  is  money  ?  Gold  and  silver  coined.  This  was  the 
only  meaning  attached  to  "  money  "  when  the  Constitution 
was  framed,  and  it  is  the  only  proper  meaning.  In  late 
days  the  word,  money,  has  been  used  to  mean  any  circu- 
lating media,  whether  gold  or  silver  coined,  or  promises 
to  pay.  That  such  is  not  the  meaning  of  the  term  as  em- 
ployed in  the  Constitution  is  evident  fromthe  phrase  "  to 
coin,"  which  prefixes  the  word,  "  money."  Promises  to 
pay  cannot  be  coined,  nor  were  any  other  metals  than  gold 
and  silver  used  as  money  in  this  country  or  any  other  at 
the  period  of  the  Constitution;  therefore,  money,  as  men- 
tioned in  that  instrument  meant  gold  and  silver  coined, 
and  could  not  have  oaeant  anything  else. 

Nor  could  it  have  meant  either  one  of  these  metals  sep- 
arately, because  of  the  aflix,  "  and  regulate  tbe  value 
thereof." 

What  is  value?  The  relation  between  two  services  or 
commodities  exchanged,  or,  to  be  more  precise,  the  quan- 
titative relation  in  services  or  commodities  between  two 


134 

services  or  commodities  exchanged.  I  have  ah'eadj'  ex- 
plained the  meaning  of  this  term.  (See  p.  19,  ante.)  It 
must  not  be  compared  with  worth,  utility,  or  desirability, 
which  are  intrinsic  qualities  or  characteristics  without 
quantity;  whilst  value  is  an  extrinsic  and  a  quantitative 
characteristic  which  is  only  determinable  in  exchange. 
Worth,  utility,  and  desirability  may  reside  in  an  object 
without  reference  to  exchange.  Value  wdthout  exchange 
is  impossible.  Law  cannot  regulate  the  worth,  utility,  or 
desirability  of  a  commodity.  Why?  Because  these  are 
intrinsic  and  incommensurable  characteristics,  and  are, 
therefore,  not  sus<3eptible  of  regulation.  Law  can  regu- 
late value,  because  value  is  an  extrinsic  characteristic,  de- 
terminable by  exchange.  But  law  cannot  regulate  the 
value  of  a  commodity  generally,  and  as  to  all  things,  un- 
less it  specifies  separately  the  quantity  of  all  things  which 
shall  be  interchangeable.  This  is  not  only  palpably  im- 
practicable, but,  even  were  it  practicable,  is  clearly  inad- 
missible as  a  construction  of  the  constitutional  phraseology. 
An  attempt  to  regulate  the  value  of  money  as  to  all  things 
would  produce  the  utmost  injustice  and  confusion  in  indus- 
trial affairs,  and  entirely  subvert  the  Constitution  and  the 
objects  for  which  it  was  established.  The  power  to  regu- 
late the  value  of  money  w^as  therefore  confined  to  gold  and 
silver  only.  It  could  not  have  been  with  reference  to  other 
things. 

11.  Even  with  reference  to  gold  and  silver,  the  power  to 
regulate  the  value  of  money  would  have  been  supereroga- 
tory unless  money  meant  both  gold  and  silver,  and  value 
the  relation  between  them ;  for  value  in  respect  to  an 
isolated  thing  is  inconceivable  and  impossible,  value  being 
a  relation  and  not  an  intrinsic  quality.  If  "money," 
according  to  the  Constitution,  meant  both  gold  and  silver, 
the  power  to  regulate  the  value  thereof  was  a  necessary 
incident  to  that  of  coinage,  and  this  view  aftbrds  the  only 
explanation  of  the  employment  of  the  phrase  "to  regulate 
the  value  thereof"  in  the  Constitution.  Otherwise  the 
phrase  was  powerless,  meaningless,  and  absurd.     To  coin 


135 

money  and  regulate  the  value  thereof  are,  therefore,  in- 
separable powers,  and  although  Congress  is  not  required 
to  exercise  them,  but  is  merely  permitted  to  do  so,  yet,  if 
exercised,  they  can  only  be  exercised  together,  and  the  ex- 
ercise of  one  power  without  the  other  is  unconstitutional. 
Therefore,  so  long  as  any  coins  of  the  United  States  are  in 
existence  the  suppression  of  the  silver  dollar  by  the  act  of 
1873  is  void.* 

III.  Practically,  the  Government  has  control  of  only  two 
commodities  among  all  those  known  to  the  world :  these  two 
are  gold  and  silver  coins.  The  Constitution  gives  to  the 
Government  exclusively  the  power  to  coin  money,  and  this 
power  gives  it  practical  control  over  the  supply  of  gold  and 
silver  coins.  It  may  be  held,  indeed,  that  the  same  power 
gives  it  also  control  over  any  substances  which  it  may  choose 
to  employ  as  money,  for  example,  copper,  tobacco,  musket- 
balls,wampum-peag,  paper  promises,  etc.  But  the  impracti- 
cability of  regulating  the  value  of  substances  of  such  heter- 
ogeneous composition  and  limitless  supply  merely  serves  to 
show  the  absurdity  of  attempting  to  extend  the  meaning 
of  the  phrase  "  money"  beyond  that  which  was  clearly  at- 
tached to  it  at  the  time  of  the  Constitution,  viz  :  gold  and  sil- 
ver coins.  These  various  substances,  and  many  others,  had 
all  been  employed  in  this  country  as  substitutes  for  money,  or 
as  tokens,  previous  to  the  Constitution,  and  some  of  them 
were  in  wide  use  at  the  time  of  that  instrument.  But  it  is 
quite  clear  that  none  of  them  were  referred  to  in  the  phrase 
"money,"  and  that  gold  and  silver  alone  were  meant. 

Having  control  of  the  two  commodities,  gold  and  silver 
coins,  and  of  these  tw^o  only,  it  was  not  and  is  not  practi- 
cable for  the  Government  of  the  United  States  to  regulate 
the  value  as  between  any  other  commodities  than  gold  and 
silver  coins. f 


*Tlie  word  dollar  was  tir.st  detiaed  in  the  coinage  act  of  April  1792. 
Therefore,  the  powers  of  coining  and  regulating  value  were  first  exer- 
eised  togctiier.  There  was  no  regulation  of  value  before  coining  :  there- 
fore no  regulation  of  the  value  of  tlie  foreign  coins  which  circulated  in 
tlie  United  States  previous  to  1792. 

t  jSTot  even  between  gold  and  silver  bullion. 


136 

Having  made  this  regulation,  Congress  went  as  far  as  it 
bad  power  to  go.  In  the  regulation  that  "  the  proportional 
value  of  gold  to  silver  in  all  coins  which  shall  by  law  be 
current  as  money  within  the  United  States,  shall  be  as 
fifteen  to  one,  according  to  quantity  in  weight  of  pure  gold 
or  pure  silver,"  (Act  of  April  2,1792,  section  11,)  Congress 
exercised  all  the  kind  of  power  which  was  conferred  upon 
it  by  the  Constitution  regarding  the  regulation  of  values. 

VIEWS  OF  THE  LAST  GENERATION  ON  THE  CONSTITUTIONAL 

QUESTION. 

The  view  herein  taken  is  that  which  has  hitherto  been 
taken  by  all  who  have  carefully  considered  this  subject. 
In  a  report  to  this  Chamber  by  one  of  its  members,  Mr. 
Sanford,  the  chairman  of  a  "  Select  Committee  to  consider 
the  State  of  the  Currency,"  appointed  by  the  21st  Con- 
gress, (see  Ex.  Doc,  2d  Session,  21st  Cong.,  Dec.  15,1830,) 
he  held  the  following  language  : 

"  The  Constitution  of  the  United  States  evidently  con- 
templates in  the  power  conferred  upon  this  Government  to 
coin  money,  regulate  the  value  thereof,  and  of  foreign 
coins,  and  the  restriction  imposed  on  the  States,  to  make 
nothing  but  gold  and  silver  coins  a  tender  in  paj^ment  of 
debts,  that  the  money  of  this  country  shall  be  gold  and 
silver.  Our  s^^stem  of  money  established  in  the  year  1792, 
fully  adopts  the  principle  that  it  is  expedient  to  coin  and 
use  both  metals  as  money,  and  such  has  always  been  the 
opinion  of  the  people  of  the  United  States." 

At  this  period  (1830)  there  was  not  a  dollar  of  gold  in 
the  country.  England  had  nearly  depleted  u5  of  what 
little  we  had  previous  to  1817,  in  order  to  prepare  for  the 
resumption  of  specie  payments,  which  had  been  suspended 
in  England  since  1797,  and  ^^hich  resumption  the  ruling 
classes  of  England  had  unwisely  or  selfishly  planned  upon 
the  basis  of  a  single  metal.  This  depletion  went  on  from 
1817  until  after  1820,  perhaps  until  1821  or  1822.  Then  it 
stopped,  so  far  as  we  were  concerned,  from  sheer  exhaus- 
tion on  our  part.     We  had  no  more  gold  to  sell.     At  that 


137 

period  we  had  nearly  $70,000,000  of  bank  paper  afloat. 
What  condition  this  country  would  have  been  left  in,  had 
our  statesmen  been  as  indifterent  then  as  they  appear  to 
have  been  in  1873,  in  regard  to  the  constitutional  require- 
ment to  make  both  gold  and  silver  legal  tender  money, 
I  leave  to  the  imagination.  Oar  population  was  then 
10,000,000.  We  had  but  lately  emerged  from  a  war  with 
England,  at  the  close  of  which  gold  had  stood,  in  our  ex- 
cessive paper  issues,  at  117,  and  an  attempt  to  resume  in 
1817  was  met  by  a  revulsion  in  1819,  and  a  secondary  re- 
vulsion in  1821. 

Imagine  10,000,000  of  people,  exhausted  by  war  and 
the  sores  of  a  double  revulsion,  depleted  of  every  dollar  of 
gold,  and  divested  of  the  power  to  resume  in  silver  or  use 
that  metal  in  the  payment  of  debts.  Do  you  suppose,  if 
the  statesmen  of  1822  had  been  as  forgetful  of  the  interests 
of  their  country  and  as  oblivious  of  constitutional  law  as 
seem  to  have  been  those  of  1873,  that  any  respect  would 
have  been  paid  to  their  legislation,  and  that  if  it  had  been 
respected,  the  country  could  have  been  saved  from  revul- 
sion and  repudiation?     I  fancy  not. 

And  this  episode  of  our  history  conveys  more  than  one 
warning,  more  than  the  warning  that  monometalism,  if 
persisted  in,  may  bring  the  country  to  great  social  and  polit- 
ical disturbances.  Some  people  are  so  filled  with  the  sense 
of  security  that  a  warning  of  repudiation  seems  to  them  a 
mere  bugaboo.  Simple  failure  in  an  attempt  to  resume 
specie  payments  is,  to  them,  an  event  of  far  greater  likeli- 
hood, if  not  of  importance.  Very  well,  then;  the  episode 
before  us  contains  the  warning  of  such  a  failure;  of  two  such 
failures.  Wetried  to  resume  in  1817;  we  tried  again  in  1821; 
and  on  both  occasions  distress  followed.  What  was  the 
cause?  Lack  of  specie.  We  tried  to  redeem  sixty  or  seventy 
millions  of  paper  with  twenty  or  twenty-five  millions  of 
coin.  What  was  the  cause  of  the  lack  of  specie?  England 
had  drained  us  of  our  gold,  which  she  virtually  overvalued 
in  order  to  prepare  for  her  own  resumption. 

But  for  silver,  the  use  of  which  as  legal  tender  had  been 


138 

preserved  for  us  by  the  Coustitutiou,  we  should  not  have 
resumed  at  all,  at  least  not  for  forty  years  after;  wheu  Cal- 
ifornia opened.  The  case  is  similar  now.  England  again 
has  drained  us  of  our  gold.  We  have  $800,000,000  of 
paper  afloat,  and  less  than  $50,000,000  of  specie  wherewith 
to  redeem  it.  Yet  Congress  orders  resumption  to  take 
place,  and  forbids  the  employment  of  silver  wherewith  to 
resume.  Is  it  not  plain  that  resumption  is  quite  impracti- 
cable; that  a  sum  of  gold  sufficient  for  the  purpose  cannot 
be  purchased  throughout  the  world  at  any  prices  for  bonds 
or  exports  at  which  we  would  be  willing  to  sell ;  and  that 
any  attempt  to  resume,  unless  the  constitutional  require- 
ments as  to  the  monetization  of  silver  are  obeyed,  will 
plunge  the  country  into  all  the  disasters  of  monetary  re- 
vulsion? 

VESTED  INTERESTS  UNDER  THE  CONSTITUTION. 

Ever  since  Mr.  Webster's  time  it  has  been  an  oft-quoted 
doctrine  that  under  the  Constitution  the  destruction  or 
impairment  of  a  vested  interest  by  act  of  Government  is 
in  the  nature  of  a  breach  of  contract.  Without  giving 
adhesion  to  this  doctrine,  it  ought  to  be  remarked  that,  as 
a  rule  of  law  it  appears  to  work  too  many  ways  to  be  prac- 
ticable, because  legislation  is  impossible  without  disturb- 
ance of  social  relations,  and  therefore,  of  existing  interests. 
However  this  may  be,  the  rule  has  been  held  to  apply  with 
peculiar  force,  though  I  know  not  why,  to  the  vested  inter- 
ests of  the  public  creditor,  and  prejudice  has  been  arrayed 
against  the  return  to  the  double  standard,  because  it  is  held 
that  payments  in  silver  might  aflect  the  interests  of  the 
public  creditor.  To  this  I  have  already  adverted  and  I  do 
not  propose  to  raise  that  question  now.  But  while  on  the 
subject  of  vested  interests  and  breach  of  contract  there  is 
something  more  to  be  said.  That  something  relates  to  the 
mining  interests  of  this  country,  interests  which,  I  think  it 
will  be  admitted,  are  quite  as  important  to  the  welfare  of 
the  country  as  those  of  the  public  creditor. 


139 

The  mining  interests  of  this  country  came  into  existence 
under  clauses  of  the  Constitution  which  it  was  well  under- 
stood made  both  gold  and  silver  money  legal  tender  for  the 
payment  of  debts.  During  the  first  three-quarters  of  the 
period  of  our  national  existence,  silver  chiefly  and  for  the 
most  time  only  was  employed  as  money;  during  the  last 
quarter  of  the  period  gold  was  chiefly  so  employed.  But 
not  until  1873  (and  that  merely  by  implication)  was  either 
metal  demonetized.  It  was  therefore  while  both  metals  were 
money  that  the  entire  gold  and  silver  mining  interests  of 
this  country  were  created  and  built  up,  at  first  upon  allu- 
vial findings  and  washings,  and  afterward  with  the  profit 
from  those  upon  the  more  ditficult  and  expensive  ores  in 
veins  and  lodes.  These  interests,  once  so  few,  now  so  nu- 
merous that  they  yearly  throw  into  the  lap  of  the  country 
$100,000,000  of  the  precious  metals,  more  than  one-half  of 
the  product  of  the  entire  world,  and  suflicient,  if  rightly 
managed,  to  render  our  country  the  clearing  house  of  the 
world,  were  literally  built  up  with  the  naked  fingers,  with 
the  rude  pick  and  cradle.  This  single  foundation  was  that 
clause  of  the  Constitution  which  makes  the  precious  metals 
money,  but  for  which  they  would  have  had  no  existence, 
and  upon  the  continued  and  faithful  observance  of  which 
they  depend  even  to-day  for  maintenance,  because  though 
of  gigantic  dimensions  in  the  aggregate  their  average 
profit  is  so  small  that  it  vanishes  with  the  slightest  disturb- 
ance in  the  value  of  the  precious  metals.  Yet  there  are 
those  who  hold  in  respect  of  these  permanent,  important, 
and  well  deserving  interests  vested  in  mining,  that  the 
interests  of  a  pack  of  clamorous  money-lenders  in  London, 
Berlin,  and  Frankfort  are  of  vastly  more  account  than 
theirs.  The  recent  project  of  a  Boston  correspondent  to 
pay  the  interest  on  the  public  debt  in  silver  dollars  they 
sneered  at  as  "a  nice  down-east  joke,"  and  bullied  about 
the  rights  of  vested  interests  under  the  Constitution. 

The  Constitution!  Sir,  when  I  come  to  pronounce  that 
word  1  do  so  with  a  respect  that  is  akin  to  reverence ;  for 
under  the  shadow  of  that  instrument,  so  wisely  and   so 


140 

wondrously  drawn  as  to  have  lasted  a  century  of  the 
"World's  busiest  times,  there  has  grown  up  from  thirteen 
feeble  and  jealous  colonies,  containing  3,000,000  people 
of  varied  origin  and  conflicting  interests,  a  nation  of  thirty- 
eight  proud  States,  containing  45,000,000  people,  free, 
homogeneous,  prosperous,  strong,  and  progressive.  When 
and  where  else  in  the  World's  history  has  such  a  growth 
been  seen  ?  The  constitution  of  the  Roman  republic, 
though  nominally  it  lasted  longer,  really  did  not  last  so 
long,  for  it  was  frequently  and  essentially-  altered  and 
modified.  It  had  to  deal  with  a  far  lesser  number  of 
States,  interests,  or  people,  and  the  progress  under  it  was 
nothing  as  compared  with  our  progress.  Take  the  most 
important  of  modern  States,  England,  France,  or  Ger- 
many. In  which  of  them  will  you  find  the  same  freedom, 
the  same  equality,  the  same  ingenuity  and  adaptability,  the 
same  energy,  the  same  elasticity,  the  same  rapidity  of 
growth,  either  in  numbers  or  wealth  ?  Since  the  date  of  our 
Constitution  England  has  scarcely  trebled  her  population. 
France  has  not  yet  doubled  hers,  while  ours  has  increased 
fifteen  times.  Our  national  life  has  not  been  without  its 
vicissitudes,  but  who  can  deny  that  it  has  been  grand, 
noble,  and  progressive,  and  that  it  is  due  all  of  it  to  that 
sacred  instrument  which  we  rightly  terra  the  Constitution 
for  the  United  States. 

In  pronouncing  the  name  of  this  instrument  I  do  so  with 
the  respect  due  to  the  mighty  agencj'  which  it  has  had  in 
building  up  a  great  nation  and  promoting  the  progress  of 
man  in  all  countries. 

In  this  remembrance  I  should  almost  regard  it  as  sacri- 
lege to  invoke  its  support  of  a  false  doctrine,  to  twist  it, 
distort  it,  or  seek  to  turn  it  aside  from  its  plain  meaning. 
And  I  regard  it  as  sacrilege  when  I  see  it  used  as  a  cover 
to  protect  the  sharp-toothed  greed  of  plutocracy. 

That  gold  and  silver  are  both  the  money  of  the  Consti- 
tution is  so  obviously  the  meaning  of  that  instrument  that 
the  question,  so  far  as  I  am  aware,  was  never  fully  raised 
until  lately  and  after  the  passage  of  the  act  of  1873.    That 


141 

the  Constitution  either  directly  or  by  the  remotest  impli- 
cation throws  any  mantle  of  protection  over  the  public 
creditor,  which  does  not  at  the  same  time  as  ampl}^  cover 
the  third  greatest  industrial  interest  of  the  whole  country 
— this  I  deny. 

Between  an  interest  which  has  become  "vested"  by 
dint  of  hasty  and  ill-considered  legislation,  and  one  which 
has  become  "  vested  "  through  bold  adventure,  the  peril 
of  life,  the  miasma  of  death-inclosing  valleys,  the  snows 
of  lofty  mountains,  the  arid  and  burning  plains,  through 
incessant  labor,  and  far  awa}^  from  "  home  "  and  familiar 
faces — between  these  classes  of  vested  interests  there  is  a 
wide  difference.  One  of  these  classes  demands  the  main- 
tenance of  the  act  of  1873,  because  it  fears  that  the  over- 
throw of  that  act  may  have  some  possible  bearing  upon  the 
advantages  which  it  has  secured;  the  other  asks  for  its 
immediate  abolition  because  it  is  unconstitutional,  it  is 
unwise,  it  is  sapping  the  foundation  of  an  industry  of  vital 
importance  to  the  country.  Let  the  Senate  decide  between 
them,  and  choose  whether  it  will  intrust  the  welfare  of  the 
nation  rather  to  the  money-dealers  of  Lombard  street  and 
the  Continent  than  to  the  hardy  mountaineers  of  the  Sierra 
ISJ'evadas,  whose  occupations  are  environed  with  danger 
and  whose  unceasing  watch-word  is  Liberty! 

WHAT  THE  HAND  OF  THE  DESTROYER  HATH  SPARED. 

Some  of  the  greatest  nations  of  the  earth  have  been  de- 
stroyed, and  it  has  been  asserted  that  nothing  remains  to 
attest  their  existence  except  the  language  they  employed. 
Such  is  the  case  with  the  ancient  Arabians,  the  Phoeni- 
cians, and  the  Carthaginians,  who  were  all  of  the  same 
race.  Such,  also,  was  the  case  with  the  ancient  Malaya, 
Egyptians,  and  Toltecs.  Ofthe  Lake  Dwellers  of  Switzerland 
or  the  Mound  Builders  of  America,  it  is  said  that  not  even 
language  remains.  And  yet  all  of  these  nations  and  many 
other  prehistoric  ones,  as  the  Pelasgians,  the  Etruscans, 
etc.,  have  left  a  legacy  to  mankind.     That  legacy  is  the 


142 

precious  metals  which  they  employed  for  money.  Much 
of  it  must  still  be  in  existence  in  some  form  or  other  of 
usefulness.  The  hand  of  the  destroyer,  Time,  hath  spared 
this,  even  while  he  hath  not  spared  language.  And  }^t 
there  are  impious  men  to-day,  who,  for  the  sake  of  a  tem- 
porary personal  advantage,  would  strike  down  this  last  and 
precious  vestige  of  nations  who  fought  and  labored  scores 
of  centuries  ago  that  we  might  now  live  in  peace  and 
plenty. 

WORSE  THAN  DESTROYING  THE  MINES. 

The  demonetization  of  silver  would  not  merely  have  the 
same  result  as  the  stoppage  of  all  the  silver  mines  of  the 
world;  the  result  would  be  far  worse:  it  would  be  as 
though  one-half  of  all  the  labor  of  past  ages,  except  what 
doubtful  legacy  has  remained  in  the  shape  of  land  im- 
provements, were  blotted  out  of  existence.  This  would 
be  worse  than  destroying  the  mines;  for  they  might  be 
reopened,  whereas  the  demonetized  metal  would  be  irre- 
trievably lost  in  the  arts  and  otherwise. 

"  LET  THINGS  STAND  AS  THEY  ARE." 

"Let  things  stand  as  they  are"  is  the  false  and  treach- 
erous maxim  of  those  who  have  wrongfully  obtained  an 
advantage  over  others.  Laissez /aire  does  not  mean  "let 
things  stand  as  they  are,"  but  "let  alone"  altogether. 
The  existing  state  of  affairs  may  be  the  result  of  a  good 
deal  of  meddlesomeness.  To  let  them  remain  as  they  are 
would  be  to  let  ruin  work  its  own  way.  The  single 
standard  foisted  upon  this  nation  by  the  act  of  1873  was  a 
mischievous  interference  with  trade,  and  things  cannot  be 
let  alone  until  this  act  is  repealed.  The  suppression  of 
the  double  standard  cannot  be  compared  with  the  usury 
laws.  It  is  ten  thousand  times,  nay,  infinitely  worse;  for 
in  the  rate  of  interest  for  money  there  is  competition 
between  money-lenders,  whereas,  concerning  the  kind  of 
metal  in  which  they  will  demand  to  be  paid,  there  will 


143 

be  no  competition  whatever.  Herein  the  interests  of  all  mon- 
ey lenders  are  identical.  The  only  way  to  meet  their  rapacity 
is  by  restoring  the  double  standard,  to  give  the  debtor  the 
same  option  in  paying  that  the  creditor  had  in  lending. 

ANTIQUITY    OF    MONEY — PREHISTORIC    NATIONS EXPERIMENTS 

IN  MONEY GOLD   STANDARD — PLATINUM    COINS. 

Hitherto,  in  alluding  to  the  antiquity  of  gold  and  silver 
money,  I  have  sometimes  used  the  expression  thirty  or 
fifty  centuries,  the  former  referring  to  the  oldest  coins 
now  extant,  the  latter  to  the  earliest  period  for  which  we 
have  indisputable  evidence  concerning  the  use  of  these 
metals  for  money.  But  if  there  is  any  credence  to  be 
reposed  in  the  numerous  authorities  quoted  in  Baldwin's 
"  Prehistoric  N'ations,"  both  gold  and  silver  were  em- 
ployed as  money  by  the  ancient  Arabians  or  Cushites,  from 
sixty  to  a  hundred  centuries  ago.  The  precise  antiquity 
of  money  is,  however,  of  little  consequence  in  this  con- 
nection. It  is  sufficient  if  we  know  that  it  is  of  very  great 
antiquity,  and  of  this  there  is  no  doubt  whatever. 

During  all  this  time  every  conceivable  sort  of  experiment 
was  made  with  money.  It  was  tried  in  ingots,  in  "  dust," 
in  wire  coils,  and  in  coins;  round,  square,  oblong,  punc- 
tured, buttoned,  milled,  and  unmilled  coins;  coins  with 
and  without  alloy  ;  pure  coins,  composite  coins,  base  coins, 
plated  coins,  coins  of  brass,  tin,  iron,  nickel,  and  plat- 
inum. 

The  history  of  platinum  coins  exemplifies  the  results  of 
all  these  experiments.  These  coins  were  adopted  in  Rus- 
sia in  1826,  during  the  notable  decline  in  the  product  of 
the  precious  metals,  which  occurred  from  1810  to  1840, 
and  before  the  Ural  and  Siberian  mines  were  opened. 
No  substance  was  intrinsically  more  suitable  to  answer  the 
purposes  of  money  than  platinum.  It  was  only  inferior  to 
the  precious  metals  in  one  respect;  but  that  respect  proved 
fatal  to  its  continuance.  There  was  no  srreat  stock  of 
platinum  in  the  world  to  modify  the  vicissitudes  of  its  cur- 


144 

rent  production  as  there  is  of  the  precious  metals ;  no 
reservoir  of  antiquity ;  no  heirloom  of  the  centuries. 
Consequently,  every  time  the  annual  production  of  plati- 
num greatly  increased,  prices  in  platinum  coins  were 
suddenly  and  violently  advanced,  and  every  time  the  pro- 
duction of  platinum  fell  off,  prices  fell.  These  violent 
aberrations  proved  fatal  to  the  continued  use  of  this  metal 
for  coins,  and  it  was  discontinued.  The  same  thing  had 
previously  occurred  with  coins  of  brass,  iron,  tin,  etc.,  and 
if  our  nickel  coins  were  anything  more  than  tokens,  mere 
promises  to  pay  stamped  on  base  metal,  the  same  thing 
would  happen  with  them. 

Substitutes  for  money  form  another  class  of  experiments 
which  have  ended  disastrously  in  bank  panics,  in  commer- 
cial crises,  in  stay-laws,  and  in  repudiation.  The  trouble 
is  the  same  with  bank  credits  as  with  coins  of  any  other 
substances  than  the  precious  metals.  There  is  no  stock 
on  hand  to  modify  the  influence  of  great  supplies. 

The  adoption  of  the  single  gold  standard  is  another  ex- 
periment in  money  of  similar  character,  and  subject  in  a 
measure  to  the  same  fatal  objection.  In  this  case  the 
stock  on  hand  is  very  great;  but  it  is  only  one-half  as 
much  as  that  of  the  two  precious  metals  combined;  and 
this  important  fact  must  settle  the  fate  of  the  experiment. 

COMPARATIVE  FACILITY  AND  COST  OF  TRANSPORTING   GOLD 

AND  SILVER. 

During  the  great  Continental  wars  of  three-fourths  of  a 
century  ago,  the  necessity  of  having  large  military  chests 
in  the  service  of  armies  rendered  it  necessary  to  transport 
large  sums  of  specie  in  the  field.  For  this  purpose  gold 
was  found  to  be  superior  to  silver  on  account  of  its  lighter 
weight  in  proportion  to  value.  While  the  fact  was  then 
so  important  that  it  may  have  had  no  little  influence  in 
reconciling  the  British  nation  with  that  formal  adoption 
of  the  single  gold  standard  which  followed  shortly  after 
these  wars,  it  is  now  of  no  importance  whatever,  even  in 


145 

Europe,  and  never  has  been  of  any  importance  in  this 
country.  Armies  do  not  employ  military  chests  now-a- 
days.  Russia,  Austria,  Italy,  Germany,  France,  and  eveu 
England,  have  fought  their  greatest  campaigns  with  the 
aid  of  treasury  or  bank  paper.  In  America  all  our  wars 
have  been  fought  with  paper.  The  colonial  Expedition  to 
Louisbourg,  in  1745,  was  conducted  with  paper,  our  war  of 
Independence  was  fought  with  paper,  our  Rebellion  was 
put  down  with  paper.  Whatever  may  be  the  evil  effects 
of  paper,  it  is  hopeless  to  expect  that  it  will  not  be  issued 
by  Governments  in  the  event  of  great  wars.  War  is  of 
itself  the  greatest  of  evils,  and  the  lesser  evil  of  paper 
merely  follows  in  its  wake,  as  sharks  do  the  mutinous  ship. 

In  times  of  peace  the  cost  of  transporting  a  given  sura 
in  gold  or  silver  is  the  same,  notwithstanding  the  lighter 
weight  of  the  former.  Freights  upon  gold  and  silver  are 
rated  according  to  value,  and  not  according  to  bulk  or 
weight.  The  freight  upon  a  ton  of  gold  from  California 
to  New  York  is  now  more  than  sixteen  times  as  much 
as  that  upon  a  ton  of  silver,  and  this  is  the  same  upon 
railway,  and  steamship,  and  other  transportation  lines 
throughout  the  world.  The  curious  will  find  the  actual 
freights  quoted  in  M.  Cernuschi's  work  on  Bi-metalism. 

The  rating  of  freights  upon  gold  and  silver  by  value 
instead  of  bulk  or  weight  is  due  to  the  important  consider- 
ation of  risk.  The  bulk  or  weight  of  a  million  dollars  in 
silver  is  far  greater  than  that  of  a  million  dollars  in  gold; 
but  the  risk  of  loss  from  accident  or  robbery  is  far  greater 
in  the  case  of  gold  than  in  that  of  silver.  An  ingot  of 
gold  worth  $2,000  could  be  very  easily  lost,  and  would  be 
very  difficult  to  recover  in  case  of  a  railway  collision,  a 
fire,  the  breaking  of  a  bridge,  a  robbery,  etc.  An  ingot 
of  silver  worth  $2,000  would  be  difficult  to  lose  and  easy 
to  recover;  nor  could  a  thief  conveniently  carry  it  off,  be- 
cause it  would  weigh  over  a  hundred  pounds.  No  guards 
are  required  to  conduct  a  shipment  of  silver  bars  because 
no  highwaymen  could  lift  them,  while  gold  ingots  of  the 
same  value  could  be  stowed  away  in  the  pocket,  and  there- 

10 


146 

fore  have  to  be  guarded  by  armed  men.  The  expense  in- 
curred in  this  and  other  wa^'s  fully  counterbalances  the 
saving-  which  arises  from  inferior  bulk  or  weioht  in  trans- 
portation. 

As  to  the  alleged  superiority  of  gold  in  handling  sums 
of  money  suitable  for  the  ordinary  payments  of  commercial 
life,  it  is  the  merest  moonshine.  One  would  suppose,  to 
hear  this  claim  made,  that  such  an  institution  as  banking 
was  unknown  to  the  world,  instead  of  being,  what  is  the 
fact,  of  seven  hundred  years'  growth.  Only  the  most  nar- 
row theorist  will  contend  that  the  resumption  of  specie 
payments  in  this  country  will  he  followed  by  the  extinction 
of  banks.  After  resumption  banks  will  receive  specie  on 
deposit  and  issue  bills  in  its  place,  and  these  bills  will  be 
used  for  payments  from  hand  to  hand,  just  as  similar  bills 
were  used  before  suspension.  The  only  dift'erence  will  be 
that,  thanks  to  the  superiority  of  the  national  over  the  old 
State  bank  systems,  the  bills  will  be  better  secured,  indeed, 
we  may  say,  absolutely  secured,  provided,  of  course,  that 
no  relaxation  is  made  of  the  admirable  and  sound  condi- 
tions and  principles  upon  which  this  system  was  founded; 
and  of  such  relaxation  we  need  entertain  no  fears. 

In  such  case,  and  in  all  cases,  we  always  have  a  perfect 
expedient  to  obviate  the  inconvenience  of  handling  coins, 
that  of  depositing  the  coins  with  the  Government,  which 
shall  issue  therefor,  dollar  for  dollar,  bills  to  be  declared 
by  law  receivable  for  a,ll  payments,  public  and  private. 

This  project  I  need  not  elaborate  at  this  time  or  in  this 
connection.  Its  suggestion  merely  serves  to  show  that  in 
any  event  our  money,  whether  of  gold  or  silver,  or  both, 
as  it  should  be,  can  always  be  made  easy  enough  to  handle, 
through  the  medium  of  representative  paper. 

It  should  always  be  borne  in  mind  that,  as  M.  Cernusclu 
remarks,  a  bill  of  exchange  (or  bank  note)  for  silver  does 
not  weigh  any  more  than  one  for  gold. 

THE  SINGLE  STANDARD  COMMERCIALLY  UNPROFITABLE. 

If  we  look  at  the  question   from  the  national  and  not 


147 

merely  the  plutocratical  point  of  view,  it  will  appear  that 
every  nation  which  demonetizes  one  of  the  metals  and 
limits  itself  to  the  use  of  the  other  only  punishes  itself. 
It  would  leave  more  money  to  the  other  nations.  Prices 
would  fall  in  the  former  countries  and  rise  in  the  latter. 
The  former  would  have  to  sell  their  products  to  the  latter 
at  low  prices  and  purchase  hack  in  high  prices;  just  as 
China  sells  to  us  now  at  low  prices  and  buys  from  us  at 
high  ones.  If  instead  of  selling  their  products  wherewith 
to  pay  for  the  products  they  purchased,  the  gold  standard 
nations  sold  their  products  wherewith  to  purchase  the  de- 
monetized metal  in  which  the  prices  of  the  other  were 
rated,  as  for  instance,  if  England  purchased  silver  where- 
with to  pay  for  East  India  products,  she  would  have  to 
purchase  such  silver  at  the  high  prices  of  commodities 
which  would  prevail  in  India  after  the  surplus  stock  of 
Europe  were  driven  thither.  In  other  words,  the  course 
of  exchange  would  be  against  the  gold  standard  nations. 
For  example,  a  pound  sterling  of  exchange  upon  India 
would  cost  more  than  a  pound  sterling  of  gold  in  England. 
Arrange  it  as  you  will,  either  product  against  product,  or 
product  against  exchange,  the  result  will  be  the  same. 
The  nations  with  a  limited  stock  of  money  would  trade 
disadvantageously  with  nations  having  both  the  metals  for 
their  standard  of  value.  This  is  the  secret  of  the  profit- 
ableness of  the  Oriental  trade.  The  Oriental  countries 
employ  but  one  metal  for  their  standard — silver.  The 
Occidental  countries  have  hitherto  employed  both  metals. 
Hence  the  low  prices  of  the  Orient  and  high  prices  of  the 
Occident  As  a  measure  between  the  labor  of  the  two 
great  divisions  of  the  world,  it  has  always  been  favorable 
to  the  Occident  This  advantage  it  is  now  proposed  to 
destroy.     To  call  it  madness  would  be  but  a  mild  stigma. 

OUR  MONEY  SHOULD  BE  EN  RAPPORT  WITH  THAT  OF  THE 

WORLD. 

Having  already  shown   that  gold    and  silver  was  the 
money  of  the  world — not  gold  or  silver  singly — it  would 


148 

seem  hardly  necessary  to  repl}^  more  specifically  to  an 
objection  to  the  restoration  of  the  double  standard  which 
some  men  suggest.  That  suggestion  is,  that  unless  we 
adopt  the  gold  standard  we  shall  not  be  en  rapport  with 
the  standard  of  England,  the  country  with  which  we 
transact  the  most  commerce. 

Those  who  suggest  this  objection  do  not  appear  to 
remember  how  foreign  exchanges  are  conducted.  Bal- 
ances of  trade  are  not  paid  in  coin,  but  in  bullion,  and  it 
makes  no  difterence  whether  the  bullion  is  of  gold  or 
silver  or  both.  It  goes  for  its  value,  whatever  that  may 
be  at  the  time.  Exchanges  are  adjusted  by  means  of  bills, 
which  are  rated  in  view  of  the  standard  of  value  in  the 
several  countries  upon  or  through  which  the  bills  are 
drawn.  Suppose  our  standard  were  of  gold,  and  we  had 
to  pay  for  a  balance  of  trade  to  China :  we  would  not 
pay  in  gold  coin,  but  in  bullion,  in  gold,  not  ;it  its  price 
in  this  country,  but  at  its  price  in  all  countries.  This 
would  be  determined  by  the  course  of  exchange,  which  is 
the  product  of  settlements  between  all  commercial  nations. 
So,  if  our  standard  were  the  double  one  of  silver  and  gold, 
our  balances  with  England  would  not  be  settled  in  gold 
and  silver  coin,  but  in  bullion,  at  its  price  in  all  countries, 
as  determined  by  the  course  of  exchange.  We  would 
settle  in  bills  of  exchange,  as  we  do  now,  as  we  always 
have  done.  So  far  as  this  objection  goes,  the  discordance 
between  the  standards  of  two  countries  is  of  no  conse- 
quence whatever.  Discordance  of  standard  is  only  mate- 
rial when  it  has  the  eii'ect  of  locally  demonetizing,  for  a 
greater  or  lesser  duration  of  time,  an  important  part  of 
the  world's  stock  of  coin,  and  this  can  only  happen  when 
several  important  countries  unite  in  demonetizing  one  of 
the  metals.  This  is  the  case  now.  Silver  is  being  driven 
to  the  Orient,  and  though,  in  spite  of  demonetization,  it 
will  find  its  way  back  in  time,  yet  meanwhile,  the  nations 
who  unite  in  demonetizing  it  will  needlessly  produce  a 
revolution  in  prices  and  the  relations  of  the  various  classes 
of  society,  which  may  seriously  affect  the  rank  of  such 
nations  in  the  scale  of  civilization. 


149 

To  render  our  standard  of  money  en  rapport  with  that 
of  England,  while  it  would  not  prove  of  the  slightest  con- 
venience in  commercial  aifairs,  would  tend  to  render  our 
institutions  of  government  en  rapport  with  hers.  If  this  is 
what  gentlemen  desire,  they  should  say  so  openly,  and  not 
under  the  mask  of  a  fancied  commercial  advantage.  Their 
constituents  will  then  be  better  able  to  appreciate  their 
statesmanship. 

GROWING  INFLUENCE  OF  THE  WORLD'S  STOCK  OF  SPECIE. 

There  was  a  time  when  the  world's  stock  of  specie  was 
80  small  that  the  slightest  vicissitude  in  the  supply  of 
bullion  from  the  mines  was  sufficient  to  cause  violent  fluc- 
tuations in  prices  and  violent  changes  of  fortune.  The  Feu- 
dal System  owes  no  little  of  its  strength  and  permanence 
to  this  fact,  for  it  was  the  only  institution  upon  which  the 
ruline:  classes,  ecclesiastical  and  secular,  could  relv  to 
secure  to  them  their  monopoly  of  wealth.  When  the 
Feudal  System,  through  many  causes,*  began  to  lose 
strength,  the  Mercantile  System  was  adopted  to  serve  the 
purpose  of  controlling  the  flow  of  specie  from  one  country 
to  another.  At  the  present  time  the  world's  stock  of 
specie  is  so  great  that  the  vicissitudes  of  supply  can  have 
but  little  influence  upon  prices,  and  as  that  stock  becomes 
larger  and  larger  the  influence  of  the  supply  will  become 
less  and  less.  Another  century  may  see  society  safely 
placed  beyond  the  influence  of  these  mutations. 

Yet  now,  upon  the  threshold  of  a  condition  of  affairs 
which  must  do  more  to  equalize  the  fortunes  of  individuals 
and  advance  the  progress  of  society  than  any  other,  it  is 
proposed  to  destroy  at  one  blow  the  work  of  countless 
centuries  by  demonetizing  one-half  of  the  world's  stock  of 
specie,  and  the  United  States  are  asked  to  assist  in  this 
work  of  superlative  madness  and  inhumanity.     Such  a 

*The  invention  of  gunpowder,  the  introduction  of  bills  of  exchange, 
the  discovery  of  America,  and  establishment  of  colonies  with  ample 
arable  lands,  &c. 


150 

propositiou,  which  could  only  emanate  from  men  crazed 
and  arrogant  with  good  fortune,  is  not  merely  an  insult  to 
the  genius  and  institutions  of  this  country;  it  is  a  bold  and 
direct  attack  upon  progress,  upon  civilization,  upon  liberty. 
The  men  who  have  made  it  do  not  merely  attack  the  pros- 
perity of  their  own  countries,  they  conspire  to  destroy 
humanity,  they  are  traitors  to  society ;  they  have  urged  a 
proposition  of  the  most  violent  and  revolutionary  character. 

NOBODY  HURT  BY  RESTORING  THE  DOUBLE  STANDARD. 

I  ask  gentlemen  to  point  me  out  one  individual  who  can 
be  injured  by  restoring  the  double  standard,  recoining  the 
silver  dollar  of  371 J  grains  fine,  and  making  it  a  legal  tender 
for  all  amounts,  as  it  was  before.  Point  me  out  one  man 
who  would  suffer  by  it.  Point  me  out  one  product  of 
the  country  which  would  be  lessened  in  its  gold  price  by 
restorins:  the  silver  dollar.  Point  me  out  one  interest 
imperiled,  one  sacrifice  sustained.  On  the  other  hand,  I 
will  point  you  out  millions  of  men  who  will  be  ruined  if 
j'ou  persist  in  retaining  the  gold  standard.  I  will  name  a 
thousand  products  of  the  country  which  will  continue  to  fall 
in  price.  I  will  show  you  a  myriad  of  interests  in  jeop- 
ardy and  innumerable  sacrifices  to  be  sustained. 

TOE  STOCK  OF  MONEY  MAKES  PRICES,  AND  THE  COURSE  OF  PRICES 

AFFECTS  CIVILIZATION. 

Double  the  world's  stock  of  money  to-day,  and  you  will 
double  all  prices.  Diminish  it  one-half,  and  prices  will 
fall  one-half.  This  relation  of  money  and  price  is  axiom- 
atic. You  will  find  it  in  all  the  books  on  political 
economy.  ]^o  writer  has  ever  ventured  to  doubt  it;  not 
even  Tooke,  who  doubted  everything,  even  his  own  opin- 
ions. 

Price  is  the  expression  of  the  measure  of  value,  which 
is  money.  The  larger  the  measure  the  larger  the  expres- 
sion or  price;  the  smaller  the  measure  the  smaller  the 
expression  or  price.     Hence,  with  a  large  stock  of  coin 


151 

in  the  world,  prices  would  be  high;  with  a  small  stock, 
prices  would  be  low.  To  increase  the  stock  of  coin  is  to 
enhance  prices,  alleviate  the  burdens  of  the  debtor  class, 
and  distribute  wealth,  to  decrease  it  is  to  lower  prices, 
increase  the  claims  of  the  creditor  class,  and  concentrate 
wealth.  One  result  leads  to  social  progress;  the  other  to 
decay.  Every  dollar  hewn  out  of  the  rocks,  no  matter 
w^hom  it  enriches  in  the  iirst  instance,  has  an  immediate 
eflect  in  alleviating  the  general  condition  of  mankind. 
Every  dollar,  worn  out,  lost,  or  demonetized  by  plutocrat- 
ical  legislation,  tends  to  lower  prices  and  concentrate 
wealth,  tends  to  impoverish  the  needy  and  enrich  the 
affluent. 

The  proposition  to  resume  specie  payments  in  this 
country  on  the  gold  standard  is  tantamount  to  demonetiz- 
ing one-tenth  of  the  world's  stock  of  silver  or  one-twentieth 
of  its  entire  stock  of  coin.  When  the  long  period  which 
has  been  required  to  accumulate  this  stock  is  taken  into 
consideration,  it  is  not  too  much  to  say  that  this  act  will 
set  us  back  in  the  command  of  some  of  the  most  important 
factors  of  civilization  as  much  as  a  century  of  constitutional 
freedom  has  set  us  forv^ard. 

THE  STANDARD  OF  VALUE  IN  VARIOUS  COUNTRIES  IN  1870. 

The  standard  of  value  which  existed  in  the  various 
principal  countries  of  the  world  in  1870  was  as  follows: 
population  in  millions  : 

Double  standard.  Silver  standard.  Gold   f^tandard. 

Country.        Population.         Country.        Population.         Country.        Population. 

United  States* 39     India 200    United  Kino-doni.     31 

France 36     China 250    Turkey* 30 

Italy* 26    Russia*  82     Brazil* 10 

Spain 17     Germany 41     Portui^al 4 

Belo;inm 5     Austria* 36     Chili 2 

Switzerland 3^  Mexico 9    Australia 2 

Greece* 1|  Sweden  "I  g 

Peru 4    Norway! 

New  Granada 3     Denmark 2 

Equador 1     Holland 4 

Central  America..      2J 


*  Specie  payments  suspended. 


152 

AN  INTERNATIONAL  STANDARD  CONVENTION. 

It  would  be  desirable  for  all  nations  to  adopt  perma- 
nently the  same  standard  of  value,  and  if  the  same  were,  as 
in  my  opinion  it  no  doubt  would  be,  the  double  standard, 
to  adopt  the  same  relation  between  the  metals.  To  effect 
this  object  all  that  is  necessary  is  an  international  standard 
convention,  which  can  be  called  by  any  one  of  the  great 
powers,  and  should  be  called  by  the  United  States.  Pro- 
vision should  be  made  that  no  other  projects  but  the  stand- 
ard and  ratio  should  be  determined  upon,  and  that  the 
nations  should  vote  according  to  population  or  wealth,  or 
on  a  mixed  basis  consisting  of  both.  For  such  an  interna- 
tional convention,  to  be  called  by  the  United  States,  there 
is  imminent  necessity.  I  regard  this  project  as  likely  to 
lead  to  results  of  the  highest  importance.  It  may  become 
the  forerunner  of  that  federation  of  the  nations  of  which 
poets  have  dreamed  and  bards  have  sung.  The  initial 
point  of  such  a  federation  is  most  fitly  the  Standard  of 
Value,  for  this  lies  at  the  base  of  all  social  and  governmental 
arrangements;  it  determines  the  institution  of  property. 

THE  PECUNIARY  INTEREST  OF  ENGLAND  AND  GERMANY  IN  THE 

GOLD  STANDARD. 

In  a  paper  published  in  the  Journal  of  the  Society  of  Arts 
for  March  10, 1876,  Mr.  Ernest  Seyd  estimates  the  amount 
of  foreign  debt  (governmental,  corporative,  and  other)  held 
in  England,  Germany,  and  France,  as  follows: 

England  from  $5,000,000,000  to  $5,500,000,000. 
Germany  "  2,750,000,000  "  3,000,000,000. 
France        "       2,500,000,000    "     2,750,000,000. 

Confining  our  view  to  England  and  Germany  only,  we 
shall  see  how  great  a  present  pecuniary  interest  these  coun- 
tries have  in  establishing  and  upholding  a  single  gold 
standard.  According  to  Mr.  Seyd's  estimates  these  two 
countries  alone  hold  over  $8,000,000,000  of  foreign  debt. 
By  limiting  themselves  to  the  single  gold  standard  and 
endeavoring  to  influence  others  nations  (our  own  among 


153 

the  number)  to  adopt  it,  they  have  already  succeeded  in 
produchig  a  decline  of  about  7-|  per  cent,  in  the  relation 
of  gold  and  silver,  this  being  the  ratio  of  the  dilference 
between  15.63  and  16.69,  the  average  relation  of  silver  to 
gold  in  1872  and  1875  respectively.  Now,  7h  per  cent,  on 
$8,000,000,000  amounts  to  no  less  a  sum  than  $600,000,000, 
which  is  the  measure  of  the  profit  of  the  British  and' Ger- 
man plutocracy  on  the  foreign  debts  they  hold.  Descend- 
ing from  the  principal  to  the  interest  on  these  debts,  if 
we  estimate  the  average  annual  interest  at  6  per  cent,  per 
annum,  which  is  certainly  within  the  mark,  the  difference 
to  these  plutocracies  between  obtaining  their  interest  in 
gold  and  obtaining  it  in  silver  during  the  years  1872  and 
1875  inclusive  has  been  no  less  than  $36,000,000  per  annum. 
Since  the  introduction  of  the  Demonetization  Act  into  the 
American  Congress  these  gentry  have  gained  $108,000,000 
by  having  their  interest  paid  in  gold  instead  of  silver.  The 
magnitude  of  this  advantage,  every  dollar  of  which  has  been 
a  clear  and  gratuitous  loss  to  the  debtor  nations,  is  surely 
enough  to  account  for  the  vehemence  of  the  plutocratical 
objection  to  the  double  standard.  With  $36,000,000  a  year 
at  stake,  there  is  little  wonder  that  they  have  succeeded 
in  marshaling  to  their  aid  so  imposing  an  array  of  advo- 
cates in  the  legislatures  and  the  press  of  the  victimized 
countries  from  which  this  extra  and  gratuitous  tribute  was 
drawn. 

THE  RIGHT  TIME  TO  REHABILITATE  THE  SILVER  DOLLAR. 

The  right  time  for  us  to  rehabilitate  the  silver  dollar,  to 
restore  the  double  standard,  is  not  when  the  necessities  of 
nations  shall  compel  them,  as  it  will  compel  them  all,  to 
go  into  the  market  for  silver.  A  simultaneous  demand 
from  Germany  and  the  United  States  alone  would  put  that 
metal  up  to  15,  perhaps  for  the  time  even  to  14.  The 
right  time  for  us  is  now,  while  silver  is  temporarily  cheap, 
and  no  other  nation  of  the  Occident  is  bidding  for  it.  Last 
month  silver  stood  at  17.82,  and  already  it  is  up  to  17.69. 


154 

Before  the  year  has  expired  it  may  etand  at  15.50.  It  is 
dangerous  and  costly  to  delay.  The  present  time  is  there- 
fore the  most  favorable  one  which  may  present  itself.  Let 
us  liot  postpone  reform  until  it  is  too  late  to  accomplish  it. 
European  demonetization  and  an  exceptional  mine  gives 
us  a  great  advantage.     Why  should  we  not  use  it? 

PRACTICAL  WORKING  OF    THE    SINGLE    STANDARD    IN  ENGLAND. 

When  an  outflow  of  specie  threatens  to  occur  in  Eng- 
land the  occurrence  is  sought  to  be  averted  and  its  eflieets 
mitigated  by  raising  the  rate  of  discount  at  bank.  This 
action  at  once  clogs  all  financial  operations  by  rendering 
them  expensive  and  diflicult  of  accomplishment.  Raising 
the  rate  of  discount  at  bank  is  like  putting  the  breaks  on 
a  railway  train  ;  lowering  it  is  like  taking  the  breaks  off. 

The  Bank  of  England  was  established  in  1694.  From 
that  year  to  the  year  1816,  a  period  of  122  years,  there  were 
only  sixteen  changes  in  the  bank  rate.  This  rate  never 
fell  below  four  per  cent.,  and  (except  in  two  instances  to 
six)  never  rose  above  five  per  cent.  During  this  period 
the  double  standard  existed  in  England.  In  1816  the  dou- 
ble was  changed  to  the  single  gold  standard.  From  1816 
to  1847 — a  period  of  31  years — there  were  sixteen  changes 
in  the  bank  rate;  as  many  as  had  occurred  under  the  dou- 
ble stand'ard  during  a  period  of  122  years.  But  these 
changes,  numerous  as  they  were,  compared  with  the  few 
that  had  previously  taken  place,  were  few  themselves 
compared  with  the  number  that  took  place  after  1847, 
when  the  gold  product  of  California  began  to  make  itself 
felt  in  the  markets  of  the  world.  From  1847  to  1874,  in- 
clusive, a  period  of  twenty-seven  years,  the  number  of 
changes  in  the  Bank  of  England  rate  was  no  less  than  223, 
and  the  rate  fluctuated  violently  from  2-1  to  10  per  cent, 
per  annum. 

These  fluctuations  have  been  ascribed  by  various  writers 
to  various  causes,  bur  none  of  these  causes  appear  to  have 
had  so  potential  an  eftect  as  the  mutations  of  the  gold  pro- 


155 

duction  of  the  world,  for  these  must  have  operated  with 
peculiar  and  great  force  in  a  country  which  alone,  among 
all  the  great  countries  of  the  world,  ]iad  committed  itself 
to  so  unstable  a  measure  of  values  as  gold. 

PRACTICAL    WORKING    OF    THE    DOUBLE    STANDARD    IN    FRANCE. 

While  I  have  not  been  able  to  obtain  in  time  for  the 
present  purposes  the  statistics  of  the  changes  in  the  rate  of 
discount  by  the  Bank  of  France,  my  general  recollection 
on  the  subject  enables  me  to  say  that  these  changes  have 
been  very  few  and,  except  at  certain  critical  financial 
junctures,  they  have  been  unimportant.  In  a  word,  the 
rate  of  discount  charged  by  this  great  institution,  which  is 
second  only  to  the  Bank  of  England  in  the  magnitude  of 
its  resources  and  operations,  has  been  changed  but  seldom 
and  slightly  from  the  period  of  its  foundation,  in  the  year 
1800,  to  the  present  day.  Even  at  the  financial  junctures 
alluded  to,  I  am  unable  to  lind  any  record  of  a  higher  rate 
than  6|  per  cent.,  and  this  occurred  during  the  suspension 
which  followed  the  Franco-German  war.  This  steadiness 
of  the  rate  is  attributable  to  the  double  standard. 

THE  BANK  RATE  REGULATES  ALL  COMMERCIAL  OPERATIONS. 

The  rate  of  discount  at  bank  not  only  regulates  the  out- 
flow of  specie;  it  also  very  powerfully  affects  all  com- 
mercial transactions.  It  is  the  price  at  which  money  caii 
be  borrowed  to  carry  domestic  produce,  to  import  and 
export  merchandise  abroad,  to  construct  railways  and 
other  public  improvements,  to  pay  debts,  meet  maturing 
obligations,  and  the  like.  Every  commercial  speculation, 
every  financial  scheme,  is  influenced  by  its  fluctuations. 
It  is  the  merchant's  inverse  barometer,  whose  fall  indicates 
prosperity,  and  whose  rise  points  to  bankruptcy  and  ruin; 
whilst  its  modifying  influence  acts  like  a  breakwater  to 
protect  the  country  from  the  flerce  currents  of  the  financial 
ocean. 

NO  SUCH  REGULATOR  IN  THE  UNITED  STATES. 

In  the  United  States  there  is  no  National  Bank  par 


156 

excellence,  no  great  central  institution  whose  operations 
govern  those  of  all  smaller  ones,  and  at  once  influence  the 
course  of  trade.  There  has  been  no  such  institution  in 
this  country  since  1837.  The  so-called  "  national  banks" 
are  private  institutions,  and  national  only  to  the  extent 
that  they  are  chartered  by  the  Federal  Government,  and 
must  conform  to  its  regulations  as  to  securities  and  circu- 
lation. They  may  each  of  them  charge  whatever  rate  of 
discount  they  please  within  the  rate  permitted  by  the  laws 
of  the  State  wherein  thej^  are  situated.  As  the  legal  rate 
of  interest  differs  in  nearly  all  the  States,  and  the  banks 
are  not  combined  under  any  single  management,  there  is 
no  uniformity  in  the  rate  of  interest  they  charge,  and  it 
follows  that,  except  so  far  as  concerns  the  action  of  certain 
prominent  banks  in  the  leading  financial  cities  of  the 
country,  there  is  no  practical  check  which  can  be  exerted  to 
restrain  or  modify  a  threatened  outflow  of  specie,  or  any 
other  financial  disaster  or  inconvenience. 

THEREFOKE  THE  UNITED  STATES  LESS  ABLE  THAN  ENGLAND, 
FRANCE,  OR  GERMANY  TO  RUN  THE  RISKS  OF  A  SINGLE 
STANDARD. 

Hence  for  the  United  States  to  trust  its  commercial 
prosperity  to  the  violent  hazards  of  a  single  standard, 
would  be  even  more  improvident  than  it  has  proved  in 
the  case  of  England.  That  country,  in  its  great  National 
Bank,  possesses  a  "governor"  upon  whose  action  it  can 
rely  to  break  the  force  of  sudden  and  great  movements  of 
specie.  Even  with  this  "governor,"  we  have  seen,  in  the 
fluctuations  of  the  rate  of  interest,  how  violent  these  move- 
ments have  been.  France  possesses  a  similar  "  governor ; " 
so  does  Germany.  The  former  country  has  never  run  the 
risk  of  trusting  to  it  in  this  matter  by  abandoning  the 
double  standard,  while  the  latter,  during  a  contemplated 
change  from  the  silver  to  the  gold  standard,  has  halted 
midway  at  the  double  standard. 

Yet,  although  quite  destitute  of  that  great  financial 
mechanism,  even  with  the  aid  of  which  France  and  Ger- 


157 

many  hesitate  to  encounter  the  great  peril  which  England 
has  invited  them  to  share  with  her,  we  of  the  United  States 
are  asked  to  adopt  the  single  gold  standard,  and  run  the 
risk  of  immediate  shipwreck.  This  may  be  sound  advice; 
but  I  must  confess  it  does  not  appear  to  come  from  people 
who  have  evinced  any  solicitude  for  the  welfare  of  the 
country. 

OPPOSITE  AND  UNEXPECTED  EFFECTS  OF  THE  FPvENCn  INDEMNITY. 

As  a  consequence  of  the  victory  of  German}-  over  France 
in  1870,  the  last-named  country  was  compelled  to  pay  to 
the  first-named,  an  Indemnity,  amounting  to  the  enormous 
sum  of  $1,000,000,000.  One  would  naturally  have  sup- 
posed that  this  indemnity  would  prove  a  heavy  burden  to 
France,  and  a  source  of  great  prosperity  to  Germany;  but, 
owing,  as  it  seems  to  me,  chiefly  to  the  retention  of  the 
double  standard  in  France,  and  the  attempt  to  establish 
the  gold  standard  in  Germany,  these  consequences  have 
been  reversed;  the  burden  is  upon  Germany;  the  pros- 
perity has  fallen  to  the  share  of  France.  The  presence  of 
a  large  stock  of  silver  coin  in  France  enabled  that  country 
to  raise  the  enormous  indemiiitj^  fund  from  its  own  people, 
who  oiFered  the  Government  five  times  as  much  as  it  asked 
for,  and  at  a  low  rate  of  interest.  This  stock  of  silver 
would  not  have  been  found  in  the  country  but  for  the 
retention  of  the  double  standard  of  1803.  The  rate  at 
which  it  was  loaned  was  so  low  that  the  country  scarcely 
feels  the  burden,  and  its  industrial  activity  has  received 
no  check. 

Germany,  on  the  other  hand,  no  sooner  received  the 
indemnit}'^  than  she  unwisely  attempted  to  follow  the  short- 
sighted footsteps  of  England,  and  changed  her  standard  of 
silver  to  gold.  What  have  been  the  consequences  ?  Panic, 
interruption  of  industry,  commercial  stagnation,  and  popu- 
lar distress.  To  this  distress,  Germany,  unlike  England, 
cannot  afford  to  turn  a  deaf  ear,  for  the  greatness  of  the 
former  country  depends  upon  its  people,  and  not  like  the 


158 

tlie  latter,  upon  its  wealth.  Already  Germany  hesitates, 
and  she  will  soon  be  obliged  to  retrace  her  ill-advised 
steps.  If  slie  does  not,  it  is  quite  safe  to  foretell  that  her 
efforts  to  establish  the  gold  standard  will  do  more  to  alien- 
ate from  her  the  affections  of  her  heterogeneous  popula- 
tions than  the  Laud  Reforms  of  Stein  and  Hardenbergh 
had  done  to  win  them.  If  such  a  result  as  a  change  from 
the  silver  or  the  double  standard  to  the  gold  one  is  the 
natural  result  of  receiving  a  great  war  indemnity,  it  will 
be  the  better  for  Germany  the  next  time  she  wins  a  victory 
to  pay  an  indemnity  rather  than  receive  one. 

LEGISLATION  ON  THE  STANDARD  OF  THE  UNITED  STATES. 

Table  showing  the  various  acts  of  the  United  States  Government  author- 
izing the  coinage  of  silver  and  gold  dollars,  or  their  multiples  or  frac- 
tions^ the  weight  of  the  same  in  pure  metal,  the  extent  to  ichich  the  same 
were  made  legal  tenders  for  tlie  pagnient  of  debts.,  arid  the  legal  relation 
thus  established  between  silver  and  gold.  Also  the  London  market  rela- 
tion of  the  metals  at  the  period  ofthej^assage  of  such  acts. 


Act. 


April  •2,1702 
July  31,  1S34. 

July  18,1837, 
Feb.  24, 1853. 


Act  r§  3516. 
Feb.  1  i  3513, 

12,  I 
1&73,  ^  I  3513, 
Rev. 
Stat. 


.?  3511, 


Coins. 


i Silver  dollar 
Gold  dollar, mul- 
tiples of* 
Silver  dollar 
s  Gold  dollar,  mul- 

(^    tiples  of 

(  Silver  dollar  and 

fractions  off 

Gold  dollar,  mul- 
tiples of. 

f  Silver  dollar 

j  Gold    doll:'r    and 

inultipli  .-   of, 

Silver  dollar,  frac- 
tions of. 

Silver  dollar 

Silver  dollar,  fr.ac- 

tions  of. 

Silver  "trade  dol- 
lar"  

Gold   dollar    and 
multiples  of. 


x;  « 


371.25 


24. 
371. 

23. 

371. 

23. 
.371. 

23. 

345. 


1347, 

378, 

23. 


Extent  of 
leg.\l  tender. 


} 


Unlimited. 

Unlimited. 
Unlimited. 

Unlimited. 

Unlimited. 

Unlimited. 
Unlimited. 

Unlimited.     J 

Five  dollars. 
Interdicted. 

Five  dollars. 

gFive  dollars.] 

Unlimited.     J 


Legal  RBL.i- 

TION. 


15.00000  to  1 
16.00215  to  1 

15.98837  to  1 
15.98837  to  1 


16.27907  to  1. 


o  « 


< 


(  About 
(14.9  to  1 

f  .\bout 
1 15.8  to  1 

J  About 
11.5.7  to  I 

/  Aboul 
1 1.5.3  to 


1 


■  About 
15.9  to  1 


*  Eagles,  h.alf-eagles,  and  quarter-eagles. 

t  Half-dollars,  quarters,  dimes,  and  half-dimes. 

J  The  act  (February  12,  l,S73)  prescribes  the  weight  of  the  debased  fractional  silver 
coins  in -'grams,"  which  another  act  (Revised  Statutes,  section  3570)  defines  to  be 
15.432  grains  each. 

?The  making  of  the  trade-dollar  a  limited  legal  tender  by  section  3586  of  the  Re- 
vised Statutes  is  believed  to  have  been  unintentional. 


159 

THE  VOICE  OF  AUTHORITY. 

The  voice  of  authority  has  ever  been  in  favor  of  the 
double  standard  and  opposed  to  the  single.  I  have  only 
time  to  quote  some  of  the  most  eminent  statesmen,  econ- 
omists, bankers,  writers,  and  practical  men  on  this  subject: 

Alex.  Hamilton.— 

"To  amuil  the  use  of  either  of  the  metals  as  inonej'- is  to  abridge 
the  quanfitt/  of  ciroilaiiii;/  medium,  and  is  liable  to  all  tlie  objec- 
tions vvhicll  arise  from  a  comparison  of  the  benefits  of  a  full,  ivHh 
the  evils  of  a  scanty,  circulation.''''     (Report  to  Congress,  1791.) 

Thos.  Jefferson. — 

"  1  return  you  the  report  on  tlie  mint.  I  concur  with  you 
tliat  tlie  unit  must  stand  on  both  metals.''''  (Letter  to  Hamilton, 
February,  1792.) 

Leon  Fauchet.— In  his  '•' Recherchcs  sur  Vor  et  sur  V argent,''''  1843, 
Leon  Faucliet  said  : 

"If  all  tiie  nations  of  Europe  adopted  the  system  of  Great 
Britain,  tlie  price  of  gold  would  be  raised  bej'ond  measure,  and 
we  should  see  produced  in  Europe  a  result  lamentable  enougii. 
Tlie  Government  cannot  decree  tliat  legal  tender  shall  be  only 
gold,  in  place  of  silver,  for  that  would  be  to  decree  a  revolution, 
and  the  most  dangerous  of  all,  because  it  would  be  a  revolution 
leading  to  unknown  results  [qui  marcherait  vers  riiiconiiu.y 

M.  WOLOWSKi.— In  a  memoir  read  before  the  French  Institute  in  ISGS 
jVl.  A\"olowski  said : 

"The  suppression  of  silver  would  bring  on  a  veritable  revolu- 
tion. Gold  would  augment  in  value  with  a  rapid  and  constant 
progress,  which  would  break  the  faith  of  contracts,  and  aggra- 
vate the  situation  of  all  debtors,  including  the  nation.  It  would 
add  at  one  sti-oke  of  tlie  pen  at  least  three  milliards  to  the  twelve 
milliards  of  the  public  del)t." 

Thougli  the  voices  and  votes  of  this  great  statesman  and  pub- 
licist, and  of  those  who  sided  with  him  in  the  debates  of  the 
Monetary  Convention  of  1865,  were  overpowered,  yet  they  still 
reverberate  throughout  the  world,  for  truth  and  right  caiuiot  be 
suppressed. 

Babon  de  Rothschild. — A  monetary  commission  appointed  by  tlie 
French  Goverinnent  in  ISOiJ  took  the  testimony  of  practical 
financiers,  who  were  luianimous  against  the  proposed  demone- 
tization of  silver.  Before  this  connnissiou  M.  le  Baron  Alphonse 
de  Rothschild  said  : 

"The  actual  state  of  tilings,  that  is  to  say,  tlie  simultaneous 
employment  of  the  two  precious  metals,  is  satisfactory  and  gives 
rise  to  no  complaint.  What  is  most  needed  in  commerce  is  facil- 
ity in  its  operations,  and  to-day  it  employs,  according  to  its  needs, 
sometimes  gold  and  somi'iimcs  silver,  and  the  partial  replace- 
ment of  silver  by  gold,  wliieli  has  taken  place  in  these  later 
times,  has  been  ett'ected  without  inconvenience." 

"They  now  demand  that  silver  sliould  be  demonetized,  as 
fifteen  years  ago  they  demanded  tiiat  gold  should  be.  The 
French  government  wisely  refused  to  demonetize  gold  then,  and 
it  will  be  equally  wise  to  refuse  to  demonetize  silver  now.  In 
fact,  whether  gold  or  silver  dominates  for  the  time  being,  it  is 
always  true  that  the  two  metals  concur  togetlier  in  forming  the 
monetary  circulation  of  the  world,  and  it  is  the  general  mass  of 


160 

the  iwo  ynefah  combvied  which  acrvci  as  the  measure  of  the  value 
of  things.  In  coiiiitrios  witii  the  double  standard  the  principal 
circnlation  will  always  be  established  of  tliat  metal  which  is  the 
most  abundant.  It  is  searccl}'^  twenty  j^ears  ago  tliat  silver  was 
the  principal  element  in  our  transactions.  Since  tiie  discoveries 
of  the  California  ainl  Australian  mines,  it  is  gold  which  has 
taken  its  place.  Xo  person  can  forsee  what  the  future  lias  in 
store  for  us,  or  can  predict  tliat  the  proportion  in  which  the  two 
metals  are  now  produced  majr  not  be  changed  in  favor  of  silver." 
*■'  It  appears  to  me  that  there  are  r(!al  advantages  in  maintain- 
ing silver  in  circulation  and  none  in  its  suppression,  since  it  is 
now  actually  a  partof  the  circulation.  I  should  regi-et  tlie  demon- 
etization of  silver  in  its  relations  to  our  internal  circulation,  our 
connnercial  intercourse  with  other  countries,  and  tiie  always 
uncertain  eventualities  of  the  future.  But  I  should  regret  it  even 
more  if  our  example  shoidtl  be  followed  by  other  nations.,  for  that 
suppression  of  silver  ivould  amount  to  a  veritable  destruction  of 
values  without  any  compensation.'''' 

"Without  doubt  the  two  metals  are  not  always  in  tlie  same 
measure  at  our  control ;  tliere  is  alwaj'sone  more  abundant  than 
the  other;  but  neither  of  them  has  ever  completely  disappeared, 
and  we  have  alwa\'s  been  able  to  lind  the  one  of  wiiich  we  had 
need." 

This  is  not  the  voice  of  plutocracy;  it  is  the  utterance  of  a 
great  financial  Power,  whose  self-interest  is  grand,  eidightened, 
and  in  harmony  with  the  other  great  interests  of  tlie  world. 

M.  D'EiCHTAL. — M.  d'Eiclital,  a  director  of  the  Bank  of  France,  said  : 
"In  cotton,  every  fall  in  price  brings  an  increase  in  consump- 
tion. But  in  silver,  if  you  take  away  its  title  of  legal  money, 
which  makes  an  unlimited  outlet  for  it,  it  must  fall  exceedingly 
low  before  it  would  find  an  emplo^'uient  equal  to  the  one  j^ou 
take  away." 

M.  RouLAND. — M.  Rouland,  the  Governor  of  the  Bank  of  France,  said  : 
"We  have  not  to  do  with  ideal  theories.  Tlie  two  moneys 
have  actually  coexisted  since  the  origin  of  human  society,  with- 
out any  disadvantage,  and  even  with  actual  advantage  in  all 
countries  which  have  availed  themselves  of  them.  They  coexist 
because  the  two  together  are  necessary,  by  their  quantity,  to  meet 
the  needs  of  circulation.  This  necessity  of  the  tivo  metals.,  has 
it  ceased  to  exist  1  Is  it  established  that  the  quantity^  of  actual 
'  and  prospective  gold  is  such  that  we  can  now  renounce  the  use 
of  silver  witliout  disaster?  In  place  of  the  two  moneys,  is  it 
entirelj'  sure  that  the  whole  world  can  be  usefully  served  with 
only  one?  " 

M.  WOLOWSKI. — M.  Wolowski  said  : 

"To  adopt  one  metal,  gold,  to  the  exclusion  of  the  other,  it 
is  not  merely  as  if  they  closed  all  existing  mines  of  silver,  but 
as  if  tlie.y  suppressed  in  this  regard  the  labor  of  all  past  ages. 
The  sum  total  of  the  precious  merals  is  reckoned  at  fift}' mil  Hards.* 
one-half  gold  and  one-half  silver.  If,  by  a  stroke  of  the  pen, 
they  suppi-ess  one  of  these  metals  in  the  monetar.y  service,  thej'^ 
double  the  demand  for  the  otlier  metal,  to  tlie  ruin  of  all 
debtors.'''' 

M.  DuiviAS. — At  the  sitting  of  the  French  Senate  on  the  28th  of  January, 
1S70.  wliich  has  properly  been  chai-acterized  as  "memorable," 
from  the  magnitude  of  the  subject  of  the  debate,  and  from  the 

•  M.  Wolowpki  here  refers  not  to  coin  only,  but  to  the  precious  metals  in  coin  and 
plate,  <fec. 


IGl 

disfiiity  and  o-ravity  witli  wliicli  llio  (Tiscii«^ion  was  niaiiitaiiiod. 
Dumas,  a  Seiialoi-,  to  \vli()S(>  words  learniiii;',  pxpcriciKH',  virlu<;, 
and  age  combined  to  give  weii4iit,  invoked  the  bod}^  to  pause  be- 
fore concluding- to  make  a  change  which  "  would  affect  the  ichole 
human  race,''''     He  said  : 

''Those  who  approacii  these  questions  for  tlie  first  time  decide 
them  at  once.  Tliose  wiio  study  (iiem  witli  care  iiesitate.  'Pliose 
who  are  oI)liged  practically  to  decide,  doubt  and  stop,  over- 
whelmed with  the  weigiit  of  the  enormous  responsibility. 

••'The  quantities  of  tlie  jirecious  metals  which  an-,  now  sulH- 
cient  nia}^  become  insuliicient,  and  we  should  proceed  withgi-eat 
prudence  before  we  diminish  tiiat  which  constitutes  a  part  of  (lie 
riches  of  the  human  race.  Sometimes  gold  takes  tlie  place  of 
silver.  Sometimes  silver  takes  the  place  of  gold.  ZVt('.s'  keepfs 
up  the  general  equilibritiin.  Nobody  can  guarantee  that  the 
present  vast  production  of  gold  will  continue.  The  placers  are 
found  on  the  siu'face  of  tlu^  earth,  and  may  be  exhausted  by  tiie 
very  facilit\^  of  working  them.  Silver  presents  itself  in  the 
form  of  subterranean  veins.  Science  may  contribute  to  acccd- 
erate  its  extraction.  In  presence  of  the  unknown,  which  dom- 
inates the  future,  we  should  practice  a  prudent  reserve." 
Henri  Ceknuschi,  the  eminent  French  political  economist  and  author 
of  La  Monnaie  Bimetalliqiie,  writ<;s  an  article  in  the  Paris  Steele 
on  the  depreciation  of  silver,  urging  England  and  America  to 
adoi)t  a  double  standard,  and  to  tix  the  relative  value  of  gold  and 
silver  at  15J  to  1 — the  rate  generally  prevalent  on  the  Conti- 
nent. Dwelling  specially  on  Anglo-Indian  interests,  M.  Cer- 
nuschi  says  : 

*•' Seduced  by  gold  ■  monouHitalism,'  Europe  has  ceased  to  coin 
silver,  but  it  had  long  coined  it  previousl.y,  and  colossal  sums  are 
in  circulation.  All  this  silver  is  to  be  called  in  and  melted  down, 
tlie  more  so  as  it  circulates  as  a  forced  currency  for  a  value  it  no 
longer  possesses.  All  this  silver  is  to  be  sold,  and  it  is  to  Lon- 
don it  will  be  sent  to  get  gold.  Floods  of  silver  going  up  tiie 
Thames,  floods  of  gold  descending;  scarcity  and  increasing  value 
of  the  yellow  metal,  Avhich  is  the  only  English  cm-rency,  glut 
and  depreciation  of  the  white  metal,  whicli  is  the  only  Indian 
currency— the  two  conflicting  '  monometalisms '  are  about  to 
face  each  other — the  one  sutVering  fi-om  ana'inia,  tlie  other 
from  plethora;  two  crises  instead  of  one — a  gold  ci'isis  and 
a  silver  crisis.  '  From  (Jalle  to  tiie  Indus  what  a  monetary 
shock,  what  a  rise  of  prices  produ(;(!d  by  the  invasion  of  silver  ! 
What  increasing  alterations  in  the  value  of  all  contracts  and 
all  engagements  flxed  in  ruptM's !  The  most  terrible  monetary 
storm  ever  known,  breaking  out  in  a  conquered  country,  amiil 
a  poi)ulation  six  times  as  large  as  that  of  the  United  King- 
dom !  Can  England  fold  her  arms?  Can  she  say  to  trem- 
bling interests,  'Be  patient;  cTerything  will  end  by  linding  its 
level?'  The  indiflerent  fatalism  to  which  somnolent  ulemas 
may  resign  themselves  is  repugnant  to  tlie  proud  Urilish  Nep- 
tune. England  will  havi^  resolution  to  eliminate  the  evil.  To 
insure  her  welfare,  she  will  desire  all  that  is  possible,  rational, 
and  efflcacious.  If  it  is  demonstrated  that  the  international 
rehabihtation  of  silver  is  the  real  solution,  England  will  not 
hesitate ;  she  will  convoke  the  nations  to  the  congress  of  mone- 
tary peace." 
11 


162 

R.  H.  Patiuorson,  ;i  distiiiii-uishcil  ])oliticiil  or-oiiomist,  says: 

''  It  appears  evuk'iit,  then,  that  the  formidable  oltjeetions 
wliieh  tlieorists  make  to  tlie  existence  of  a  double  standard  of 
vahie  in  a  ooiuitry  are  nnsupiKnted  by  facts.  Tiiey  conjure  up 
a  vision  of  •  hydras,  i^-or^ons,  and  ciiimeras  dire  for  which  we 
feel  no  appreliension'.  If  a  country  has  enouii-h  of  i>-old  or  of 
silver  to  make  its  coinage  entirely  of  that  metal,  g-ood  and  well. 
But  if  not — as  is  the  case  in  India — by  all  means  let  it  employ 
both  metals.  The  correctness  of  this  opinion  is  abundantly 
shown  in  the  case  of  France.  In  that  most  loij-ical  of  countries 
the  double  standard  has  loui;-  been  established,  and  no  one  there 
has  any  desire  to  abolish  it.  Durinii;-  the  last  dozen  years  this 
double"  standard  has  been  subjected  to  the  severest  test  that 
could  be  ap])lied,  and  yet  every  one  is  satisfied  with  its  work- 
ino-.  Gold  is  ponriuii' "in  ;  silver  is  pouring-  out;  a  revolution  is 
being  ell'eelvd  in  the'  currency  of  France  ;  yet  no  one  complains. 
Evidently  practical  or  ai)pi'e"cial)le  disadvantage  of  any  kind  is 
quite  unknown.  Theoretically,  as  we  have  shown,  a  double 
standard  cannot  do  much  harm  ;  practically,  we  find,  it  does 
none  at  all.  And  since  it  works  under  the  most  trying  circum- 
stances without  the  least  injury  in  Finance,  it  may  safely  be  in- 
tnuhiced  williout  any  apprehension  and  with  great  advantage 
into  India."— R.  II.  Patterson,  The  Ecoiiomi/  of  Capilalljon- 
don,  ]8(;4,  p.  ryj. 
Ernest  Seyd.  This  able  and  impartial  wi-iter  has  written  several 
works  on  coin  and  bullion  whicli  evince  a  thorough  knowledge 
of  these  ditliiMilt  subjects.     He  says  : 

"The  rejection  of  silver  as  a  standard  of  value  would  be  a 
most  unwise  and  dangerous  proceeding.  It  would  be  a  far  better 
and  safer  course  to  establish  the  double  gold  and  silver  valua- 
tion." — Bullion  and  Foreign  Eaichanges^  London,  1SG8. 

"  AYe  think  it  can  be  shown  that  tii'e  gold  valuation  has  been 
injurious  to  En<;land's  inter(;sts  in  lier  foreign  trade  as  well  as 
in  iier  internal  llnaiicial  policy."     Ibid. 

Similar  views  are  entertained  in  Mr.  Seyd's  latest  essay  pub- 
lislied  in  the  -lonrnal  of  the  Society  of  Arts  for  March,  1S7G. 

CONCLUSION. 

I  have  done.  For  the  patience  and  attention  with  wliich 
Senators  have  listened  to  an  exposition  unusually  lengthy 
and  somewhat  tedious,  I  thank  them,  and  can  only  plead 
the  transcendent  importance  of  the  subject. 

There  is  yet  time  to  utido  the  work  of  1873,  to  correct 
the  grave  blunder  perpetrated  by  the  Mint  Act  of  that  year, 
in  interdicting  the  American  silver  dollar  and  substituting 
the  single  standard  of  gold  for  the  money  of  the  Constitu- 
tion. The  disastrous  effects  which,  in  my  opinion,  are 
bound  to  flow  from  this  attenuation  of  the  standard  and 
the  basis  of  prices  and  credit,  are  not  yet  felt;  because  of 
the  existing  suspension  of  specie  payments.     But  so  soon 


163 

as  specie  payments  are  resumed — if,  indeed,  they  can  ever 
be  resumed  without  the  restoration  and  co-ordination  of 
silver  in  the  standard — will  the  bad  effects  of  this  legisla- 
tion develop  themselves  and  make  their  mark  upon  the 
affairs  of  the  country.  It  may  then  be  too  late  to  re- 
form. 

The  present  is  therefore  the  acceptable  time  to  undo  the 
unwitting  and  inconsiderate  work  of  1873,  and  to  render 
our  legislation  upon  the  subject  of  money  consistent  with 
the  physical  facts  concernitig  the  stock  and  supply  of  the 
precious  metals  throughout  the  world,  and  conformable  to 
the  Constitution  of  the  country. 

We  cannot,  we  dare  not,  avoid  speedy  action  upon  this 
subject.  J^ot  only  do  reason,  justice,  and  authority  unite 
in  urging  us  to  retrace  our  steps;  but  the  organic  law  com- 
mands us  to  do  so;  and  the  presence  of  peril  enjoins  what 
the  law  commands.  By  idly  interfering  with  the  standard 
of  the  country.  Congress  has  led  the  nation  away  from 
the  realms  of  prosperity  and  thrust  it  beyond  the  bound- 
aries of  safety.  To  refuse  to  replace  it  upon  its  former 
vantage-ground,  would  be,  to  incur  a  responsibilitv  and 
deserve  a  reproach,  greater  than  that  which  men  have  ever 
before  felt  themselves  able  to  bear. 


A.  p  F  E  ]sr  D I  s: . 


MOVEMENT  OF  THE  CURRENCY. 


liable  J.,  shotving  the  currency  of  the  United  States  from  1775  to  lS75, 
inclusive.     Sums  in  millions  of  dollars  arid  tenths. 


Year. 

Coin. 

United    S'I'ates 
and  national 
bank  notes. 

State 

BANK 

notes. 

Total 

PAPER. 

o 
z 

a 

■< 

o 

■< 

S 

B. 
O 

CM 

5 

si  o 
P 
O 

Remarks. 

1775 

$G.O 

85.0 

$11.0 

2.5 

$4.40 

Lord    Sheffield    (Sey- 

177.')-1TR1 

bert,     554)    says   914 
coin. 
Era    of    "  Continental 

1790 
1711 

Ifi.O 

10.0 
17.0 
20.0 
21.5 
19.0 
10.5 
10.0 
14.0 
•17.0 
17.5 
17.0 
16.5 
IG.O 
17.5 
18.0 
18.5 
20.0 
20.0 
20.0 

19.0 
18.0 

17.0 

17.0 

17.0 

20.0 
24.5 

*22.0 
*20.0 

S2.0 

$1.0 

3.0 

9.0 
7.0 

n.o 

11.5 
11.0 
10.5 
10.0 
9.0 
10.0 
10.5 
11.0 
10.0 
11.0 
14.0 
15.0 
17.0 
18.0 
22.75 

19.0 

25.0 
24.0 
31.0 
33.0 
30.0 
27.0 
20.0 
23.0 
27.0 
28.0 
28.0 
26.5 
27.0 
31.5 
33.0 
35.5 
38.0 
44.7 
44.0 

45.0 
46.0 

52.0 

69.0 

69.5 

65.5 
74.5 

77.0 
80.0 

3.9 

4.0 
4.1 
4.3 
4.5 
4.6 
4.8 
4.9 
5.0 
5.2 
5.3 
5.5 
5.7 
5.9 
6.1 
6.3 
6.5 
6.7 
6.9 
7.0 

7.1 
7.3 

7.6 

7.8 

8.0 

8.2 
8.4 

8.6 

8.8 

4.87 

6.25 
5.85 
7.20 
7.40 
6.50 
5.00 
5.30 
4.60 
5.20 
5.30 
5.10 
4.70 
4.60 
5.30 
5.20 
0.50 
5.70 
6.40 
6.10 

0.10 
6.10 

6.80 

8.80 

8.70 

8.00 

8.80 

8.90 

','.1111 

money." 

Repudiation  of  Conti- 
nental issues. 

First  bank  U.  S. 

1792 
1793 

5.0 

2.0 

1794 

1795 

1790 

1707 

Suspension  Banlv  Eng- 
land; flux  of  gold. 

Expiration  of  charter 
of  First  Bank  United 

1798 
1799 

180(1 

1801 

States. 

1802 

1^03 

1801 

1805 

1806 

1807 
1808 



Embargo  Dec.  22;  first 
steamboat. 

1809      • 

24.0 

Specie  drain ;  Mexican 
disturbances;  stop- 
page of  mines;  sus- 
pension N.  E.  banks. 

Drain  of  specie. 

Apprehension  of  war. 

1810 

26.0 
28.0 

35.0 

52.0 

51.5 

45.5 
50.0 

55.0 
60.0 

1811 



1812 

(Drain  of  .specie.) 
War  declar'd  with  Eng- 

1813 

land. 
War  continued;  bank 

1814 

mania. 
August  and  September 

1815 

all  except  N.  E.  h'ks 
suspended  until  Jan- 
uary, 1817.     Gold  114 
@  120. 
February,  peace.   Gold 

ISK) 

115  @  102. 

Gold    116  @   117,    107; 

1817 

second  bank   U.   S. ; 

England  adopts  the 

gold  standard. 
Partial  resumption  of 

Bank  United  States. 
Height  of  bank  mania; 
;         gold  drain. 

1818 

*In  these  years  the  coin  was  all  of  silver;  no  gold.  (Report  of  Mr.  White,  H.  Rep., 
21st  Cong.,  2d  seps.,  No.  95.)  In  the  year  1830  coins  in  li.nnk  $15,000,000,  silver  in  circu- 
lation $h\oi  10,000,  bank  notes  $77,000,000;  total  SI 00,01  Mi,0oo.  (Senate  Rep.,  21st  Cong.,  2d 
sess.,  Dec.  5,  1830,  tiy  Mr.  Sanford,  from  Select  Com.  on  Cur.) 

( 164  ) 


165 


Table  A — Continued. 


H  S  2 

State 

Total 

o 

o 

5 
a. 

Year. 

Coin. 

«^^ 

BANK 

< 

z  S 

Remarks'. 

a      M 

PAPER. 

V  ^ 

&S  z 

NOTES. 

^ 

0. 

a  t 

z  5  ■« 

-< 

o 

rt 

5^« 

o 

Ph 

1819 

«20.0 

62.5 

82.5 

9.1 

9.20 

RevuLsion. 

1820 

*26.5 

58.0 

86.0 

9.4 

9.00 

r.e.'^umption  of  Bank  of 

England  ;  continued 

eflUix  of  5;old   from 

United  States. 

1S21 

*23.0 
*18.0 

65.0 
70.0 

88.0 
88  0 

9.7 
10.0 

9.10 
8.80 

Spring  strict're.  (Tuck- 

\'ii-l 

er,  p.  208,  says  18.  to 

1823 

*17  0 
*18.0 
*19.0 
*20.0 
*22.5 

76.0 
78.0 
81.0 
80.0 
75.0 

93.0 

96.0 

100.0 

100.0 

97.5 

10.3 
10.6 
10.9 
11.1 

11.5 

9.00 
9.10 
9.20 
9.00 
8  50 

20.  coin.) 

1824 

1825 

1826 

Tempor'y  bank  panic. 

1827 

Winter  stricture. 

1828 

*27.0 

68.0 

95.0 

11.9 

8.00 

Fir^-t  railwfiy  in  U.  S. 

1829 

1=31.(1 

12.5 

50.0 

62.5 

83.5 

12.4 

7.50 

Temporary  bank  pan- 
ics; Pre.s.  Jackson 
declares  against  re- 
chartering  United 
States  Bank. 

1850 

*32.0 

61.0 

93.0 

12.8 

7.20 

Report  of  Cong.  Com. 
favoring  bank 

1831 

35.0 
39.0 

6(i.O 
71.0 

101.0 
110,0 

13.2 
13.(; 

7.65 
8.10 

Bill  introduced   to  rc- 

1832 

cliarter  bank. 

1833 

42.7 

77.0 

119.7 

11.0 

8.50 

Removal    of    deposits 

from  hank. 

1834 

CO.O 
80.0 

90.0 
103.0 

1.50.0 
183.0 

14.4 
14.8 

10.40 
12.40 

Veto  of  bank  bill. 

1835 

Great  fire  in  New  York ; 

loss,  5^20,000.000. 

183G 

65.0 

140.0 

205.0 

15.3 

13.30 

Expiration  of  ciiarter 

of  Second  Bank  U.S. 

1837 

73.0 

149.0 

222.0 

15.8 

14.00 

Great  svspknsio-v. 

Universal  in.'^olvoncv  ; 

1838 

87.0 

116.0 

203.0 

16.2 

12.50 

banker's  repudiation 
of  Morris  canal  stock ; 

1839 

87.0 

135.0 

222.0 

16.7 

13.40 

■  general  contraction; 
fall  in  prices ;  stay 
laws;  bankr'p'vlaws; 

1840 
1841 

83.0 
80.0 

107.0 
107.0 

190  0 
187.0 

17.0 
17.5 

11.20 
10.70 

liquidation;  riots. 

1842 

60.0 

83.7 

143.7 

18.0 

8.00 

Repudiation     of     the 

States. 

1843 

70.0 

58.5 

128.5 

18.6 

6.90 

Lowestdepression;  re- 

sumption. 

1844 

100.0 
96.0 
97.0 

75.0 

90.0 

105.5 

17.5.0 
186.0 
202.5 

19.2 
19.8 
20.4 

9.10 
9.40 
9.90 

Increase  of  currency. 

1845 

184G 

1847 

120.0 
112  0 
120.0 
154.0 

105.5 
128.5 
114.7 
131.0 

225.5 
240.5 
234.7 
285.0 

21.0 
21.6 
22.4 
2.3.2 

10  07 
11.10 
10.50 
12.20 

1848 

California  mines  open- 

1849 

ed. 

1850 

1851 

186.0 
204.0 

15.5.0 
156.0 

341.0 
360  0 

24.0 

24.8 

14.20 
14.50 

1852 

1853 

236.0 

144.0 

380.0 

25.6 

14.80 

1854 

240.0 
257.6 
250.2 

178.6 
187.0 
196.0 

418.6 
444.6 
446.2 

26.4 
27.1 

27.7 

15.80 
16.40 
1(;.10 

Australian  mines. 

1855 

1856 

1857 

259.3 

215.0 

474.3 

28.4 

16.70 

Temporary  panic;  su.s- 
pension. 

1858 

251.6 

1.55.0 

406.6 

29.1 

11.00 

Resumption. 

1859 

265.8 
257.0 

193.0 

207.0 

458.8 
457.0 

29.7 
31.5 

15.40 
14.,50 

1860 

1861 

241.4 

202.0 

443.4 

32.3 

13.70 

Civil      war;      demand 

notes  issued. 

*  In  these  years  the  coin  was  all  of  silver;  no  gold.  (Report  of  Mr.  White,  H.  Rep., 
2Ist  Cong.,  2d  sess.,  No.  95.)  In  the  year  l.'<30  coins  in  bank  $15,000,000,  silver  in  circu- 
lation 58,000,000,  bank  notes  $77,000,000;  total  S1(KU)00,000,  (Senate  Rep.,  21st  Cong.,  2d 
ses3.,  Dec.  5, 1830,  by  Mr.  Saniord,  from  Select  Com.  on  Cur.) 


1G6 

Tabic  A — Continued. 


<    S    01 

>5 

!a 

E-  =  H 

o 

CO  t<  g 

State 

Total 

f  ^ 

Year. 

Coin. 

B  Z  » 

BANK 

■< 

^E 

Remaiiks. 

-  5  a 

NOTES. 

PAPER. 

< 

CM 

§5 

H 

t^-^s 

C 

o 

18G2 

298.5 

184.0 

482.5 

22.9 

21.00 

Suspension;  green- 
backs issued. 

1803 

100.0 

411.0 

101.0 

572.0 

672.0 

24.5 

27.40 

Circulation  of  State 
banks  supplanted  by 
national  Ijanks. 

1864 

90.0 

513.0 

140.0 

053.0 

743.0 

20.1 

28.50 

National  bank  notes; 
liighe.st  inflation. 
Gold  285. 

1865 

85.0 

604.0 

05.0 

609.0 

754.0 

30.3 

24.90 

Peace ;  gradual  con- 
traction. 

18G6 

100.0 

713.0 

37.0 

750.0 

850.0 

t36.0 

23.00 

Rehabilitation  of  tlie 
South. 

1S67 

HO.O 

704.0 

nom. 

704.0 

844.0 

t37.0 

22.80 

Extinction  of  State 
batk  circulation. 

1S6S 

HO.O 

690.0 

11  om. 

099.0 

839.0 

t38.0 

22.00 

Contraction  continues 
slowly. 

1S(;9 

140.0 

(i92  0 

nom. 

G:l2  0 

832.0 

J39.1 

21.20 

Contraction  continues 

1870 

1;j2.S 

704.0 

nom. 

7114.0 

8.50.4 

38.0 

22.20 

slowly. 

1871 

130.7 

723.7 

nom. 

723.7 

800.4 

39.6 

21.70 

GreatChicasofire;  loss 
S150,000,0(I0. 

1872 

VlS.l 

741.4 

nom. 

741.4 

809.5 

40.6 

21.40 

Great  Boston  tiro;  loss 

SS0,O(  10,0110. 

.T;in.'7;^ 

1.30.0 

752.0 

nom. 

752.0 

882.0 

41.7 

21.10 

Silver     demonetized; 

Oct. '73 

140.0 

762.0 

20.0 

872.0 

922.0 

41.7 

22.10 

panic ;  $20,000,000 
elearing-hou.'ie  cer- 
tificate.s  and  $10,- 
000,000  Treasury  re- 
serves issued  as  cur- 
rencv ;  e:old  imp'rt'd. 

1874 

140.0 

701.1 

nom. 

701.1 

901.1 

42.9 

21.00 

Contraction  contin'ed. 

1875 

142.0 

736.3 

nom. 

7311.3 

878.3 

44.1 

19.90 

Contraction  contin'ed 

f.'iecording  to  censuses  taken  in  1866,  1867.  and  1868  by  the  Bureau  of  Statistics 
through  the  Internal  Revenue  organization.  The  census  of  1870  shows  a  smaller  pop- 
ulation than  that  of  lsi;9,  but  the  discrepancy  is  attributed  to  the  different  moans  and 
metliods  adopted  to  effect  the  enumeration.  The  figures  subsequent  to  1870  are  based 
upon  the  census  of  that  year. 

X  Estimate  based  on  census  of  1808. 

FAILURES    IN    BUSINESS. 

The  followin^^  table  (B)  is  from  the  Mercantile  Agency 
Reports,  and  shows  that  the  number  of  failures  in  business 
in  all  the  States  of  the  Union  has  closely  followed  the 
movement  of  the  currency: 

Year.  Movement  of  Ciin-ency.  Failures. 

1859  Increasing  3,913 

1860  Increasing  3,673 

1861  Decreasiiig 6,^93 

1862  Increasing  1,652 

1863  Increasing  485 

1868   I)ecrca.sin"g 2,608 

1869  Decreasing 2,799 


167 

Tnldc  B-Conlinned. 

Year.  Movement  of  Curreiioy.                     Failures. 

1870   Decreasing 3,551 

1871   Decrecisino; 2,915 

1872  Decreasine: 4,060 

1873  Decreasing 5,183 

1874  Decreasing 5,830 

1875   Decreasing  7,740 

There  were  but  few  failures  during  the  rapid  increment  of 
the  currency  from  1862  to  1866.  Since  that  period  the  num- 
ber of  faikires  has  steadily  and  largely  increased,  until  now 
it  is  7,740  per  annum,  and  during  the  first  three  months 
of  1876  it  was  2,806,  or  at  the  rate  of  11,224  per  annum. 

The  failures  in  New  York  City,  taken  by  itself,  were  as 
follows:  1871,  324;  1872,  385;  1873,  644;  1874,  645; 
1875,  951;  and  during  the  first  three  months  of  1876,  313. 


Periot 
1856- 

'60  . 

TABLE 

No. 
in 

C — FIRES 

of  years 
period. 

.  5  

.  1  

.  5  

.  1  

.  1  

.  1  

.  1  

.  1  

.  1  

.  1  

.  1  

.  1  

IN  NEW    YORK    CIT^ 

Currency  during-  the 
period. 

Increasing"  

Av'i^   annual 
No.  tire.s. 

653 

1861 

Decreasins" 

827 

1862- 

Increasinsr  

720 

.  .  Decreasing 

1867 

1,012 

1868 

...  Decreasing 

912 

1869 

...  DecreasiuiT 

914 

1870 
1871 

...  Decreasing 

..  Decreasins" 

867 

916 

1872 

.  .  Decreasing 

922 

1873 

...  Decreasing 

1,017 

1874 

...  DecreasinsT 

841 

1875 

.    Decreasinar 

1,093 

Annual  average,  1867  to  1875,  inclusive,  944 

The  number  of  these  fires  which  were  of  incendiary  ori- 
gin are  only  given  for  the  years  1855  to  1860,  inclusive. 
They  were  as  follows:  1855,159;  1856,100;  1857,87; 
1858,90;  1859,68;  1860,110.  The  ratio  of  incendiary  to 
total  fires  during  this  period  was  about  30  per  cent.  Ac- 
cording to  the  New  York  Insurance  Reports  it  is  believed 
to  be  now  over  50  per  cent. 


168 

MARRIAGES. 

The  correspondence  between  marriages  and  tlie  price  of 
broad-corn  was  shown  statistically  some  forty  years  ago  by 
the  illustrious  Qnetelet.  The  following  table  shows  the  cor- 
respondence between  marriages  and  the  movement  of  the 
currency.  Ohio  is  one  of  the  few  States  of  the  Union  in 
which  social  statistics  are  compiled  under  official  authority: 

Table  D,  showing  the  number  of  3Iarriages  in  Ohio. 
Year.  Movement  of  carreiicy.  Marriao-cs. 

1859  Increasing     22,671 

1860  Perturbation 23,106 

1861  Decreasing    22,251 

1862  Increasing     19,540 

1863  Increasing     19,300 

1864  Increasing     20,881 

1865  Increasing     22,198 

1866 Increasing     30,479 

1867 Decreasing 29,230 

1868  Decreasing    28,231 

1869  Decreasing    23,910 

1870  Decreasing    25,459 

1871  Decreasing    24,627 

1872  Decreasing    26,303 

1873   .'..   Decreasing    26,460 

1874   Decreasing    26.678 

1875   Decreasing    27,047 

The  population  of  the  State  of  Ohio  was  in  1850  1,980,- 
329,  in  1860  2,339,511,  and  in  1870  2,665,260. 

The  decrease  of  marriages  accompanying  the  diminution 
of  currency  which  has  gone  on  since  1866  is  complemented 
by  a  corresponding  increase  of  divorces. 

DIVORCES.- 

Table  E,  showing  the  number  of  Divorces  in  Ohio. 
Year.                                                                Cun-enc}'.              Divorces. 
1866-1869  (average  3  years)  Decreasing 1,003 

1870        Decreasing 1,008 

1871        Decreasing.......  1,077 

1872        Decreasing 1,026 

1873        Decreasing 1,124 

1874       Decreasing 1,159 

1875       Decreasing 1,299 


169 


The  above  evidences  of  "  bard  times  "  are  supplemented 
by  the  statistics  of  desperate  and  criminal  acts,  all  of  which 
have  constantly  diminished  whilst  the  currency  of  the 
country  was  increasing,  and  increased  whilst  the  currency 


was  decreasing. 


HOMICIDES  AND  SUICIDES. 


Table  F,  showincj  the  number  of  inquests  held  upon  Homicides 

and  Suicides  in  Ohio. 


.    ,  ,,  Homicides  and 

Period.  Currency.  suicides. 

1858-1860  (average  3  years)  ...  Increasing   144 

1861        Decreasing  190 

1862-1865  (average  4  years)  ...  Increasing   162 

1866-1869  (average  4  years)  ...  Decreasing  182 

1870       Decreasing  162 

1871       Decreasing 128 

1872       Decreasing 211 

1873        Decreasing  206 

1874       Decreasing 219 

1875       Decreasing 261 


SUICIDES. 

Table  Cr,  showinr/  the  Suicides  in  the  Gitij  of  New  York. 

Year.  Currency.  Suicides. 

1866    Decreasing  58 

1867    Decreasing  76 

1868    Decreasing  98 

1869    Decreasing  102 

1870     Decreasing  101 

1871    Decreasing  , 114 

1872    Decreasing  144 

1873    Decreasing  118 

1874    Decreasing  - 

1875    Decreasing  157 

12 


170 


Table  E,  showing  the  Suicides  in  the  City  of  Fhiladeljohia. 


Suicides 


Average. 

20 

31 


Currency. 

Perturbation. 

Decreasinfj. 

Increasii)sr. 

lucreasing. 

Increasing. 
[^  Increasing. 

Decreasing. 

Decreasing. 

Decreasing. 

Decreasing. 

Decreasing. 

Decreasing. 

Decreasing. 

47  Decreasing. 

59  Decreasino^. 

CD 

Decreasing. 


PRISONERS. 


Tabic  I,  showing  the  number  of  persons  in  ]jrison  in  all  the 
United  States  in  June  of  each  of  the  years  1850,  1860,  and 
1870,  such  being  the  periods  at  which  the  last  three  decennial 
censuses  were  taken. 


Period. 


Movement  of  x>^ i„.; Persons  in 

currency.    ^  Population.     ^^^.^^^_ 

1850    Increasing  23,191,876     6,737 

1860    Perturbation  31,443,323  19,086 

1870    Decreasing  38,558,371  32,904 


INDEX. 


PAGE. 

Asiatic  coninierce 118 

Autlioi'ities  1")9 

Bank  of  Eiio'laud 154 

Bank  of  France 155 

Bank  rate 155 

Bankruptcies 40,  50,  TO,  16G 

Banks 37 

Banlc  suspensions 40,  50,  70,  166 

Bills  of  excliange 36 

Changing  tlie  standard 26 

Cobden  on  tlie  standard 55 

Coinage  act  of  United  States,  4,  5,  158 

Commerce 118 

Comstock  lode 50,  104 

Constitutional  argument 132 

Corn  rent 55 

Credit 17 

Crescendo  and  diminuendo  tiieorj',  124 

Currency  of  United  States 164 

Dark  ages 32 

Deartli  of  gold,  1809-48 52 

Debtor  and  creditor S3 

Debts,  national 152 

Demonetization,  act  of  1873 60 

Divorces 108 

Double  standard,  6,  7,  08,  83,  103,  105, 

116 
Double  standard,  act  of  April   2, 

1792 3 

Draper's  statement  of  coin  in  Gran- 
ada   130 

East  India  and  China  trade 46,  47 

Effective  measures  of  value 71 

Failm-es 40,  56,  70,  166 

Fairs 37 

Feudal  system 33 

Fires 167 

Fluctuations  of  the  metals 45 


PAGE. 

Fi-eight  on  specie 145 

French  standard 155 

German  demonetization 5 

Germinal,   law  of    7th   Germinal, 

Anno  XI,  (March  28,  1803) 54 

Gold  chiefly  a  Briti.«h  product 81 

Gold    not    a  cori-ect    measure  of 

values 09,  76 

Gold  product 74 

Gold  purchased  for  former  wars....  145 

Gold  standard 104,  105,  117 

Gold  standard  invites  paper  infla- 
tions      89 

Granada,  coin  in 130 

Homicides 109 

Household    suffrage    affected    by 

fluctuations  of  money 52 

Indemnity,  French 157 

International    Standard     Conven- 
tion    152 

Interest  on  United  States  debt 102 

Independent,  the  New  York 70,  97 

Japan,  standard  of 115 

Jevon's  diagram 08 

Laissez  faire 142 

Legislation  and  money 158 

Lord  Liverpool's  report  on  coins...     50 

Marriages 168 

Mexican     and     South     American 

trade 123 

Military  cliestsof  gold 145 

Mining 23,  31,  39,  104,  105,  139 

Mint  act  of  1873 01 

Mint  charges 4 


Monetary  Convention  of  1 865 60 

Money  and  prices 150 

Money  and  population 35 

Money,  cost  of l(i,  17 


172 


PAGE. 

Money,  cHicioncy  <tf 15 

Money,  principles  of 10,  10 

Mone3',  stock  of 6,  .'51 

Money,  various  substances  used  as..     "21 

National  debts l'i'3 

XcAvtou,  Sir  Isaac,  his   report  on 

coins 50 

Panics  40,  56.  76,  166 

Paper  money H8 

Petty,  Sir  William,  the  first  mono- 

metalist 56 

Platinum  coins 143 

Population    71 

Prehistoric  nations 14)^,  144 

Preniiuni  on  specie  in  United  Slates 

during  su.spension  of  1814-"17....  164 

Prisoners 170 

Progress  in  mining,  order  of 110 

Pi'oduct  of  precious  metals 74 

Katio  of  gold  and  silver 29 

Kelation  of  15J,  causes  of 64 

Eelative  value  of  precious  metals...    42, 

43,  44,  46,  58 

Reservoir  of  .specie 130 

Resumption 90,  95 

Eesiunption  in  Enj>"kiiid 94 

Rise  of  prices  in  Asia 78 

Russian  mines 4,53 

Sanford,  Senator,  his  opinion .'.  136 

Siberian  mines 53 

Silver  product 74 

Single  standard  of  England  154 


Social  effects  of  money 125 

Stability  of  silver 45 

Standard  (^barges 27 

Standard  of  Belgium 51,  53 

"         "  England 48,  50,  51 

''        '•  Germany 51,  53 

"        ''   Greece 58 

"   Holland 51,  53 

"    Xaples 53 

"         *'   Roumania 58 

"'         ■'    Scandinavia 51 

"        "   Spain 51,  53 

"   United  States. ..51,  53,  158 
•'        "   vai-ious    countries    in 

1S70 151 

Stock  of  specie 38, 

39.  40,  41,  42,  07,  113 

Subsidiary  coins 78.  79 

Suicides 170 

Suppl}^  and  consmnption,  precious 

metals 27 

Sn-spensions 40,  56.  76,  151,  160 

Transportation  of  specie 145 

Ural  Mines •  53 

Value 19,  133 

Vested  interests 138 

War,  gold  formerly  employed  in...  14$ 

Wealth  of  tlie  ancients. 29 

Wheat  as  a  standard  of  value 55 

World's  population 71 

World's  stock  of  coin 67,  71 


THE  LIBRARY 


# 


f\    /t    r.  t 


I 


AA    000  590  496    6 


I 


